Court rules in favor of German gambling regulator in TV competitions dispute

The Munich Court upholds German gambling regulator’s decision on TV competitions, stating that a license is required regardless of minimum stake or prize.

The German federal gambling regulator, Gemeinsamen Glücksspielbehörde der Länder (GGL), has emerged victorious in a court case involving its decision to crack down on a television broadcaster for conducting gambling activities without a proper license. The GGL had determined that the pay-to-play “competitions” organized by the unnamed broadcaster constituted unlicensed online games of chance, and the court has upheld this ruling.

Germany’s federal gambling laws, as amended by the Fourth Interstate Gambling Treaty (GlüNeuRStv) approved in July 2021, categorizes any cash-prize contest that necessitates an entry fee as a form of gambling. Notably, the recent ruling by the Munich Court has clarified that there is no minimum threshold for stakes, indicating that even competitions with minimal costs and small cash prizes could still be considered as gambling under the law.

The court concurred with the GGL’s perspective, affirming that the television broadcaster had indeed been providing unlicensed gambling. The GGL had accused the broadcaster of discontinuing the illegal gambling product on its platform by modifying it to conform to the legal requirements.

Benjamin Schwanke, a board member of GGL, expressed satisfaction with the impact of GGL’s approach, stating, “The judicial affirmation of this ban marks another stride in the battle against illegal gambling.” He further emphasized that paid games categorized as “raffles” would be classified as games of chance if the outcome depends on luck, in line with GGL’s stance.

Ronald Benter, another board member of GGL, expressed optimism that the recent court ruling would set a precedent and encourage other providers to remove their illegal offerings from the market upon GGL’s request. This indicates GGL’s determination to take action against illegal gambling activities and enforce compliance with the applicable regulations.

In the previous month, GGL released an estimate stating that 95% of online bets placed in Germany in 2022 were made through operators that were whitelisted and compliant with regulations. This contradicts claims made by the industry association Deutsche Sportwettenverband (DSWV) that illegal gambling activities were increasing due to overly stringent regulations in the legal market. GGL’s figures suggest that the majority of online betting in Germany is being carried out through authorized and regulated channels, indicating the effectiveness of their regulatory efforts.

The GGL has urged gambling operators in Germany to enhance their collaboration to further improve the country’s emerging gambling market. Since taking over full control of federal gaming regulation in January, the GGL has commended operators for their cooperation, but believes more can be done. During a session at the Research Centre for Gaming at the University of Hohenheim, GGL CEO Ronald Benter emphasized that licensees could play a pivotal role in combating illegal gambling. He stated, “We are making significant progress in creating an attractive legal market, with the majority of permit applications being approved. However, we still observe inadequate cooperation from online gambling providers.”