German Court Affirms Authority of Gambling Regulator to Enforce Penalties for Gambling Advertisements

German Court Upholds GGL’s Authority to Enforce Advertising Law Compliance.

The Higher Administrative Court of Saxony-Anhalt has issued a ruling confirming that Germany’s recently established gambling regulator, Gemeinsamen Glücksspielbehörde der Länder (GGL), possesses the necessary powers to enforce regulations and impose penalties in response to violations of advertising laws. This decision comes following complaints from several online casino operators who expressed dissatisfaction with the regulator’s approach.

Saxony-Anhalt, the state that serves as the host for the new German gambling regulator, saw the GGL assume full functionality earlier this year, replacing the interim gambling authority that was in place. The court’s ruling establishes the legality of the GGL’s supplementary provisions, granting the regulator the ability to enforce prohibitions on various forms of gambling advertising. These include restrictions on advertisements by social media streamers, influencers, infomercials, promotions for social casino games, and affiliate marketing that directs users to unlicensed gambling sites.

However, it is important to note that the court clarified that a complete ban on gambling advertisements in public spaces does not exist.

The court’s statement read:

“After conducting a summary examination, it has been determined that the majority of the contested supplementary provisions are legal. Specifically, the 3rd Senate has approved the bans on infomercials, advertisements for free online casino games and virtual slot machines, influencer marketing, advertisements by streamers, and affiliate advertising with partners who promote illegal gambling. These measures are likely to be legally permissible.”

The court emphasized that these regulations are necessary to ensure compliance with the objectives outlined in the interstate treaty on gambling, which include mitigating the risks of addiction and protecting minors.

Previously, the court had already supported the GGL’s stance on affiliates promoting unlicensed gaming, ruling that the regulator has the authority to prohibit gaming licensees from advertising on websites featuring such activities.

This court decision follows the imposition of a significant fine, in the five-figure range, by the GGL against an unnamed licensee for breaching the regulations. The operator had deliberately advertised on websites that promoted illegal gambling, thereby violating the interstate gambling legislation that came into effect in July 2021.

However, this recent court ruling clashes with the verdict of the Administrative Court of Hamburg, which declared that the ban on influencer marketing lacks a legal basis. Licensed gambling operators have argued that Germany’s stringent restrictions on gambling advertisements inadvertently create an environment that favour the black market.

Key Points:

• The Higher Administrative Court of Saxony-Anhalt has affirmed the power of Germany’s gambling regulator, Gemeinsamen Glücksspielbehörde der Länder (GGL), to enforce rules and impose penalties related to advertising law violations.
• The GGL, which took over as Germany’s gambling regulator this year, has faced complaints from certain online casino operators regarding its regulatory approach.
• The court ruling validates the legality of GGL’s ancillary provisions, allowing it to enforce bans on various forms of gambling advertising, including those by social media streamers, influencers, infomercials, and affiliates promoting unlicensed gambling sites.
• However, the court emphasized that there is no complete ban on gambling ads in public spaces.
• The court acknowledged that the regulations are necessary to align with the goals of the interstate treaty on gambling, such as preventing addiction and safeguarding minors.
• Previously, the court supported the GGL’s authority to prohibit licensed operators from advertising on websites that feature illegal gambling activities.
• It is worth noting that the court’s decision contradicts the ruling of the Administrative Court of Hamburg, which stated that the prohibition on influencer marketing lacks legal grounds.
• Licensed gambling operators argue that Germany’s stringent restrictions on gambling ads inadvertently favor the black market.