ECJ Rules Against German Gambling Monopoly

September 13, 2010 | News Category: Gaming Law

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There has been much going on in the European Union regarding gambling laws, and online gambling laws in the EU member states. While some countries have had their online gambling laws approved, albeit after some changes were made, others are still not conforming with the European Community’s guidelines.

The European Court of Justice (ECJ) has recently ruled that Germany has not followed the necessary guidelines, and are in fact going against the European Commission regulations by following online gambling laws that are monopolistic in nature.

Although the European Union laws do have a loophole in place, which allows states to operate online gambling monopolies, Germany does not fall into the category that would be allowed to use this law. The law does allow an EU member nation to impose bans on online gambling operations that are privately run, and allows the states to run only their state owned online gambling monopolies. However, it is stated as part of this law that this can only be done in cases in which the public interest is served, and compelling reasons exist, which would make the state choose to go this route.

A compelling reason, for example, would be to prevent gambling addiction, however, the German online gambling monopolies that currently exist are not currently attempting to do this. In fact, these state run monopolies have been running advertising campaigns that encourage not only online gambling, but particularly games of chance. Games of chance boost online casino profits considerably. As part of their ruling, the ECJ noted: "German rules do not limit games of chance in a consistent and systematic manner."

Online gambling change in Germany could take some time, because the country itself is operating under the German State Gambling Treaty, which started on January 1st 2008. According to the treaty, private online gambling operations are prohibited in Germany. The German State Gambling Treaty only ends in 2011, which means that it is still to be followed for a considerable amount of time before things will change. Even though, last year, the German state, Schleswig-Holstein attempted to demand that the treaty be dissolved early, they had no luck with this, and the treaty is still in force.

The European Commission has attempted to convince Germany to fall in line with their guidelines as far as online gambling is concerned, but since Germany would not play ball, the ECJ has had to step in with an official ruling. At this time, it seems likely that Germany’s monopolies will simply reduce the amount of advertising for games of chance that they have been using, in order to try and prove that they are operating in the best interests of German citizens.