The German Sports Betting Association (DSWV) has been one of the most outspoken critics of the government’s reluctance to take more decisive steps towards cracking down on the illegal gambling market. This is now set to change, as the government has announced what could be seen as a new initiative to address the issue and actively seek to tackle the clout of black-market operations locally.
Trade body calls on new government to translate good intentions into effective policy
The DSWV is responding to a commitment shared in passing by the newly formed CDU/CSU and SPD government, which will be headed by Chancellor Friedrich Merz, with the new coalition signaling that it would seek to improve the government’s response to the still thriving gambling market.
The DSWV has welcomed these remarks as "an important signal" but pointed out that the formulation was rather vague and that to have any tangible impact on the current regulatory framework, and improve market conditions, the government would have to transform good intentions into effective policy.
Matej Novota, Casino Guru's Head of Data & Complaints, who has been monitoring the German market for the past several years, welcomed the government's acknowledgement of the issue, but cautioned that any effective response would need to focus on at least two things:
The fact that the government is signaling readiness to address the unregulated gambling market in Germany is a promising early sign, but lawmakers need to build a real legislative and regulatory momentum for any of this to work. DSWV's proposals are underpinned by strong evidence that the approach must be multi-pronged, making the regulated market more attractive while targeting unlicensed companies and making them accountable. I strongly believe that unless both of these conditions are met, a simple crackdown against the sector will likely fall short. Ultimately, these measures are ambitious yet realistic, but the government may be reluctant to enact such sweeping reform on short notice. Progress will depend on how well the government engages with stakeholders to co-develop a sustainable enforcement framework.
To this end, the DSWV has called for strengthening the autonomy of federal states, reducing excessive bureaucracy and improving the tax framework so that it is more competitive, and enhances the visibility of legal providers.
Ultimately, argues the DSWV, the only way to create a safe and fair gambling market would be by addressing the illegal gambling market that continues to undermine the licensed sector. The country also needs to take proactive measures to strengthen the regulated market.
Setting up an action plan and carrying it out
To achieve these ends, the DSWV proposes a five-step process, which will focus on strengthening the attractiveness of the regulated gambling market, and helping providers remain competitive.
To give the regulated sector teeth, argues the DSWV, a nationwide specialized public prosecutor’s office might be a decisive next step.
A new central investigative authority that focuses on cracking down on illegal gambling, and specifically Internet gambling, could be a cornerstone on a stronger regulated market in Germany. There is a strong justification for that, argues the DSWV in its official statement:
"Many proceedings currently fail due to a lack of jurisdiction or the international dimension of the providers. Such a public prosecutor's office could specifically investigate providers from abroad and ensure more effective prosecution."
Equally important, any oncoming regulatory efforts should have a "follow the money" approach, which could help reveal more black-market operations and address them with the full force of the law.
Similarly, the Digital Services Act could be put to use and make platforms such as affiliates and illegal operators more accountable if they are found to have been promoting unauthorized gambling. Equally importantly, the DSWV argues that Germany needs to build on stronger national gambling laws that are harmonized on a national and European level, following uniform standards.
