A new set of restrictive online gaming laws proposed by the most of the German states has set off waves of frustration from online gaming companies and could have serious consequences for affiliates.
If approved, the new laws could also cause serious tension within the European Union (EU) which is moving towards less restrictive gaming laws.
The changes, which are set to take effect, next July would seriously impact the German iGaming market. Some key components of the new legislation include:
- Only granting 20 licenses to gaming site operators.
- A 5% turnover tax, which is implemented before a sale is ever made.
- The plan only provides for legal sports betting. Table games, including poker, would remain illegal.
But there’s a wrinkle to this story that contains good news for affiliates. Only 15 of the 16 German states, known collectively as Lander, are in favor of the legislation. Schleswig-Holstein has introduced its own set of reforms, which are set to take effect in January, that are more in line with the rest of the EU.
The Schleswig-Holstein plan includes provisions for table games, and charges a 20% tax on on gross profits (which is considerably more favorable towards gaming site operators). For affiliates, this could mean continued access to the large German gambling market.
Online gaming trade groups, including the Remote Gaming Association (RGA) lashed out at the proposals criticizing them as both repressive and illegal under EU treaties. RGA, CEO Clive Hawkswood, told media outlets the German plan was a disingenuous attempt to regulate the gaming market and would do little to prevent Germans from gambling with offshore sites.
Hawkswood went on to praise the Schleswig-Holstein plan for their similarity to laws in other EU countries such as Spain and Denmark.
Affiliates who are hoping to capitalize on the German market should be aware that Germany’s Federal Government is not particularly enthusiastic about online gambling. In the past, they’ve attempted to block gambling sites and punish financial institutions that process gaming transactions.
How do you think the new German gaming laws will affect affiliates? Let us know in our Online Gambling Laws and Regulations Forum.