European Commission Doubts German Betting Legislation

28.08.2019, 17:38

The European Commission (EC) with German’s gambling industry is once again becoming sour. The commission doubts if the plans that German’s authority has put in place will yield any fruit. Sports betting liberalization planners initiative remain perturbed despite the warning that EC has issued.

German media on Monday reported that EC had issued the “blue letter” to express their dissatisfaction on the process of legalizing betting in the country. German’s authorities plan to begin issuing betting licenses at the start of 2020. The EC’s July letter expresses doubts if Germany’s third State Treaty would succeed in the attempt to limit the grey/black betting market.

The sixteen German states approved the new stopgap treaty in March to lengthen the “toleration” period for the sports betting operators. Fortunate operators that will be able to secure a betting license at the beginning of next year will be free to operate until June 30, 2021. The stopgap treaty will only take permanent measures after the “toleration” period has elapsed.

EC, on their part, feel that the interim licensing period is too short to effect meaningful legislation. The commission further reiterated that even with the option to extend the “toleration” period to three years, the time wouldn’t be enough for the colossal unauthorized operator to apply for licenses.

End to German Online Casinos?

The EC fears that the stopgap treaty could be meant to edge operators out of the market. In such a scenario, the operators will be forced to continue offering online casinos, which the same treaty forbids. It’s also expected that online casinos will be a thing of the past when the sixteen-state reach consensus for the final treaty.

Traditionally, EC uses the blue letter as a playbook tool to warn members’ states against continuing with legislation that the commission considers as full of flaws. If a member state chooses to defy EC’s warnings, then the commission has no alternative but to initiate a formal infringement proceeding.

It’s not the first time that the commission is finding faults with the German’s legislation process. The imposition of the hard cap on the number of licenses available in the second state treaty had also attracted the commission’s warning. Besides, the European authority had also rubbished plans by Germany to constitute a regime that could be more appealing to EC.

Despite all these happening, German’s regulators are perturbed of EC threats. The State Chancellery of North-Rhine Westphalia spokesperson was captured saying that the blue letter “doesn’t contain a cause for change” in the stopgap treaty. If Germany decides to take the Italian route, the EC might look more as an aggressor than the arbiter it should be.