German legislation on casinos and other parts of the e-gaming industry is a bit unstable; however, Germany is now on the edge of the significant reformations that are going to arrive in 2021 and will make the whole online casino business radically different from the prevailing system.
To start with, let’s determine that the regulations of gambling are different for land-based properties and online gambling operators. No constraints are applied towards the holders of poker rooms, casinos, and slot machine owners unless all this recreation performs in the offline format. After a range of changes and periods of a total ban, brick-and-mortar casinos are perfectly legal from 1950 in Germany — in every state of the country. Certainly, the businesses are managed by the German officials, but no major limitations exist — you can enjoy poker, roulettes, one-hand bandits in all German Federal States and particularly Baden Baden — the unofficial gaming center of Germany.
Who controls casinos in Germany?
There is no centralized authority that regulates the performance of gaming organizations, so each of the 16 states has its own local jurisdiction that reserves the right to establish the rules of the licensing and working process of casinos. They are not only responsible for licenses and obeisance to the German gambling law, but also for the performance of the players.
The land-based casinos are partly state-owned and partly private; some of them have a mixed form of ownership. All of them, though, are the subjects of the local state law. This of course creates a range of difficulties in terms of thorough monitoring of the owners and members of such companies and prevents the government from gaining the most of the profit from the wealthy gaming businesses.
Are Internet casino games legal in Germany?
Since the casino online industry has entered the era of its development all over the world, it became obvious that a) it becomes more difficult to monitor how the laws are followed and b) that online casinos started gaining more and more attention from the players. German authorities could not ignore this but have not thought of anything but totally prohibiting all online casinos — just to avoid any kind of fraudulent actions towards the users. However, it became obvious soon that such measures lead to the development of the illegal casino business, and, what is more, to the significant decrease of income that the federal budget gains from the casino activity.
Online gambling in Germany before 2020
Until 2008, Internet gaming was not controlled by the government at all. In 2008, the latest online gambling law has totally banned online casino recreations, as well as online poker, and online sports betting, except horse racing and sports stakes provided by the German state institutions. Later in 2012, the Interstate Treaty On Gambling was released which allowed each state to accept its own terms and conditions on an online segment of the casino business. However, only the state of Schleswig Holstein took advantage of this offer and issued permission for fifty operators while e-gambling in other states shifted to a so-called grey zone, which resulted in many players to prefer picking the casino platforms holding a foreign license.
New German online gambling laws
The situation as it has developed could not last forever, mainly because such tenuous regulations are in contradiction to the European Union requirements on online gambling and irretrievably led to a significant decrease of the gambling companies on the local market.
Thus, in September 2020, a new law was released which allows all operators to receive federal online casino and sports betting licenses which are valid on the whole territory of the country. Till July 1, 2021, all operators will be forced to go through the process of gaining new licenses. This became a revolution in the area of online games in Germany and will give players more opportunities, they were deprived of before.
What will the new regulation mean for players and operators?
Even the top casino can not exist in a European country if its actions are outlawed on the governmental level. Many websites with international licenses had to block access for German members and lost a significant part of their earnings; the players were persecuted by the law, too, and the gambling industry on the Internet was under the threat of becoming a completely illegal zone of business. As the German gambling community is the biggest one in Europe, it was impossible to keep all players in the illegal zone without controlling them and without receiving taxes from online platforms. The new measures will protect players from fraudulent actions against them and are going to ban the accounts of the ones suspected in ludomania or scam.
The new regulations, however, forced some websites to exit the German market as they found it impossible to lead the business as an online casino legal in Germany. The main reason for that is the requirement to remove all table games from the website services; no roulettes or blackjack can be offered by the casino sites in case they want to be approved by the new licensing organs. In addition, the whole concept of the casino has to be changed: the user should not feel the experience of the real offline casino; instead, the website should look more like the arcade games gallery and even the word ‘Casino’ has to be replaced by its synonyms.