15 German States Approve Restrictive Gaming Treaty amid Criticism

15 of the 16 German states have agreed to approve a restrictive new gaming treaty that will regulate and tax the gambling industry.

The treaty was rejected by the European Commission and received ample criticism from many in the online gambling industry.

The most vocal objection came from the Remote Gambling Association (RGA) that voiced its objection when the treaty was initially proposed and throughout the negotiating process between the different German states.

The draft treaty is planned for full implementation by July 2012 and will limit the number of licensed operators to 20 and impose a 5% turnover tax that experts say is unviable and wholly uncompetitive.

The tax is expected to limit betting amounts on sports betting and the treaty itself completely prohibits online casinos, online poker rooms and live betting operators from offering their services to German punters.

RGA CEO Clive Hawkswood said that “there appears to be no connection between the desire to provide German citizens with a regulated market and the actual text of the State Treaty”.

Hawkswood also insisted that this legislation will have little effect in limiting the number of German gamblers that play at online casinos licensed in foreign jurisdictions as such restrictions have always failed in the past.

The new State Treaty is in complete contrast to the legislation passed in Schleswig-Holstein, the 16th state that got frustrated with the other 15 States delaying agreeing on legislation and continually proposing an unworkable law.

As we reported back in September, Schleswig-Holstein passed its own law that is far more reasonable and allows for all forms of online gambling. This law will come into effect in January 2012.