SBC News Voice of the Sports Betting Industry
In the third of a series of columns on international gambling legislation, GVC’s Director of Regulatory Affairs Martin Lycka ruminates on the development of the online gambling market in Germany.
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Once upon a time, there were sixteen kings in a land in the heart of Europe. The land’s credo was thou shalt not gamble online. Nevertheless, the kings’ subjects chose to gamble on the land’s web and thus implicitly beseeched the kings to summon a kings council to ponder and debate the credo. The council confirmed the credo in its full glory. However, following the sitting of the council, an Emperor’s court to which all the kings’ courts were subject ruled that the credo fell foul of the Emperor’s gambling rules and ordained the kings to think again.
The kings ruminated about the matter at hand in council for the second time and then solemnly declared that online betting shalt be temporarily permitted whereas other online games shalt languish in the land of darkness (allegedly owing to an angst expressed by the kings’ men whose business was to sell lottery tickets). The kings further stipulated that the future betting related dispensations would be fraught with severe limitations on the seekers’ enterprises. The interpretation of the land’s credo having been thus changed, the kings’ councillors subsequently set off to grant twenty royal dispensations to seekers whose enterprises would be deemed most worthy of one.
At the same time, a northern king, Sebastian-Harald III, SH for short, broke ranks with his fellow kings and sanctified all online games in his land. SH’s move prompted online gambling enterprises to pursue a two-pronged stratagem by means of seeking dispensations in both the northern land and the united lands of the other 15 kings.
The 15 kings’ councillors considered supplications they had received from gambling enterprising subjects and selected twenty worthiest amongst their number for the privilege of becoming one of the kings’ suppliers. The northern land also completed its selection process and issued licences. The land in the heart of Europe was thus seemingly en route to a two-system regulatory model. However, the 15 kings’ system never really came into being; its flaws and fallacies having been challenged and exposed in the kings’ courts. The twenty licences have (so far) not been granted …
The 15 kings reconvened in council again in a bid to find a path forward; it however turned out that there were too many a king amongst their number who expressed their displeasure with matters as they were. Following further strenuous deliberations, with the northern king back in the fold, the (now once again) 16 kings finally brought themselves to act in unison and decreed that the sports betting licences shalt be issued, without a limit on their number, in not too a distant future and that new regulation, potentially extending to a wider scope of online gambling products, be considered for introduction in summer 2021.
The exact nature of the future regulation however remains, at least to some extent, shrouded in haze and mystery of the royal corridors of power; it is scheduled to be debated again by the 16 kings’ councillors in September 2019 and afterwards by the kings themselves in October and very likely beyond… Despite the persisting uncertainty, an ever increasing number of the 16 monarchs have declared that the only acceptable manner of disentangling the gambling Gordian knot is by means of a much more inclusive regulation, failing which they would be prepared to break away from the others, just like the northern king did back in the day, and potentially form a regulatory alliance.
While the deliberations surrounding new regulation are afoot, scribes sworn to serve the lords operating online gambling products have been in the throes of preparing letters, charters and other documents to be submitted to the licensing councillors of the 16 kings, citizens of the city of Darmstadt. It was announced at an assize held by the Darmstadt councillors in mid August 2019 that the sports betting licence supplications will have started being reviewed only in January 2020; no date for their grant has been set in stone just yet. It is expected though that the supplications will rain down on the Darmstadt councillors in droves, which might, with all due respect, lead to significant “snowedunderedness” at their end and materially delay the licensing process. Call me a faint-of-heart but I would not bet my horse, let alone my squire, on the exact date of the grant of the future licence at this point in time.
What is clear though is that the outcome of the licensing process itself will have a role to play in the ruminations about the future online gambling regulation in the land in the heart of Europe. If I was summoned to the next kings’ council and my advice on this matter was sought, having respectfully bowed my head and cleared my throat, I would give the following one, with a view to ensuring that the future regulation be in compliance with all legal and practical commandments:
- “Thou shalt regulate all products in the marketplace and subject them to licences” – it is beyond imperative in my view, in particular for responsible gambling and integrity purposes, that casino and poker be included amongst the number of licenseable products;
- “Thou shalt not impose arbitrary statutory limits on the online gambling offer” – it has been proven that statutory limits do not reflect the reality of the marketplace and are in no position to duly reflect affordability levels of individual customers; it is humbly submitted that customer set limits (subject to source of funds and responsible gambling checks) shalt be considered a much more preferable and at the same time effective option in this regard; and
- “Thou shalt preserve the existing lottery monopoly” – experience from other EU Member States has demonstrated that online casino does not cannibalise on the lottery market; it is further respectfully submitted that EU law does not require opening up of the domestic lottery market in the event the casino has been licensed.
The author of these humble lines truly believes that new German regulation along the aforesaid lines would have the ability to bring the seemingly endless jostling, squabbling and skirmishing around this topic to an end to the benefit of all involved subjects.
Martin Lycka is Director of Regulatory Affairs at GVC Group. Before that he spent nearly ten years at Paddy Power Betfair working on international markets. Views expressed are personal and not necessarily those of GVC Group.
The German market will be discussed at next week’s Betting on Sports Conference at London Olympia in two sessions DACH – Vision 2021 and Analysing the German sports bettor. Find out more by clicking here.
