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New Authority for Online Gambling

Article authored by Nikolai Straimer

Since 1 January 2023, the new Joint Gambling Authority of the Federal States (GGL) in Saxony-Anhalt (Halle) has fully taken up its duties. While the authority was recently only responsible for enforcement against unauthorised gambling and unauthorised advertising, since 1 January 2023 it is now responsible for the full regulation of the online gambling market (lotteries, sports and horse betting, virtual slot machines and online poker). The central task of the GGL is to supervise the German online gambling market. Protecting young people and players from gambling addiction and manipulation are at forefront of the regulatory objectives. For this purpose, the GGL examines and approves gambling offers on the internet and takes action against the black market.

As of 1 January 2023, applications for deviations from the monthly EUR 1,000 deposit limit for virtual slot games and online poker are now also possible. So far, increases of the monthly deposit limit up to EUR 10,000 and up to EUR 30,000 were only possible for operators of sports betting – provided the operator had explicitly applied for the increase and a corresponding licence was granted. Now, increases for players of virtual slot games and online poker are to be allowed to deposit more, provided the operator applied for a deviation and has been granted a corresponding licence.

The prerequisite for such an increased monthly deposit limit is, above all, that the operator checks the player’s economic capacity is sufficient. One could say increased deposit limits for players requires increased monitoring obligations for the operator. Specific benchmarks or precise official guidelines on how financial capacity is assessed do not yet exist. This could be an opportunity for third-party providers, as there are hardly any external tools that can give a reliable assessment of the financial standing of the player.

The regulatory authority checks compliance with the deposit limits through the so-called central files, which consist of a file for monitoring the deposit limit across all operators (limit file) and a file for preventing parallel gaming at several gambling operators (activity file). Due to data protection concerns, the connection to the file is repeatedly criticised. 

In the case of virtual slot machine games, another important change has been in place since 1 January 2023. Since the beginning of the year, applications for a deviation from the EUR 1 per game (spin) limit for virtual slot machine games have been possible. The previous regulation in the Interstate Treaty on Gambling 2021 stipulated that the stake may not exceed EUR 1 per game without exception. Whether and to what extent the GGL will approve increasing stake per game is still uncertain. First rumours are floating that the authority will grant deviation to the monthly deposit limits provided a formal application and sufficient justification is submitted, but will be reluctant to grant deviation to the EUR 1 stake limit per game. Reasons could be that the first reports of the operators are to be awaited in order to obtain better evaluation of the regulated market. It remains to be seen whether all operators will accept this rejection or file a lawsuit against such a negative decision.

It would not be the first lawsuit to be brought against the GGL. In fact, the authority is already involved in a large number of legal proceedings. Reasons for this are not only the increasing number of licences for online poker and virtual slot machines issued by the predecessor authority State Administration Office of Saxony-Anhalt, but also the sports betting licences issued by the Regional Council of Darmstadt at the end of 2022. The authority had also transferred its jurisdiction to GGL at the end of the year. How the authority will cope with the many new issues it has to deal with has yet to be revealed. One thing is certain, it will not run out of work any time soon.