The German sports betting trade association Der Deutsche Sportwettenverband (DSWV) has urged the new federal gambling regulator Glücksspielbehörde der Länder (GGL) to immediately protect the German online gambling market from “unauthorized threats “.
Last week, the GGL formally took over regulatory oversight of GlüNeuRStv, Germany’s fourth-largest interstate gambling regime, replacing the Saxony-Anhalt Executive, which was the market’s interim governance authority.
Established six months ahead of schedule, the GGL faces a series of complex challenges to fix the unloved German GlüNeuRStv regime. Marketplace licensees have spoken out on operational challenges and business gaps related to the scheme’s license application, product restrictions, advertising rules, compliance requirements/costs and conditions of competition with land holders.
The leadership duo of Ronald Benter and Benjamin Schwanke will serve as GGL’s co-CEOs.
The DSWV welcomed the formation of the GGL, wishing “the new national gaming authority a good start into a new era of regulation for German online gambling”.
Described as the most pressing issue, the DSWV urged the GGL to “effectively combat illegal online gambling”, as a key criterion for the Bundesländer to compromise the GlüNeuRStv regime’s regulatory mandate, in 2021 .
“The assumption of the task of combating the illegal market by the GGL is an important step for the German gambling market,” said DSWV Chairman Mathias Dahms.
“The Authority is facing major challenges today, and we hope it will overcome them as well. The unregulated black market has been able to grow to gigantic proportions virtually unhindered in recent years. It must therefore intervene now and create a fair market as soon as possible.
The DSWV noted “disturbing comments” from GlüNeuRStv’s 36 licensed sports betting operators who observed an “unprotected market” in which unlicensed competitors “walk around oblivious to necessary player protections.”
Monitoring the new online gambling market in Germany, the DSWV has identified 507 illegal websites that actively target German consumers because “registration from Germany is possible without any problems”.
The ease of engagement with German consumers has exacerbated licensees’ fears that “the volume of the black market can hardly be estimated” and that illegal operators have significantly increased their market share since the launch of GlüNeuRStv.
The GGL has indicated that it will thwart black market threats by using its regulatory controls on intellectual property and blocking payments on unlicensed operators.
DSWV welcomed IP and payment blocking as short-term measures and advised GGL to focus on creating a better licensed offering as an effective solution to protect German consumers.
The DSWV believed that the success of the GGL as a regulator will be measured by achieving a high channeling rate, ensuring that consumers engage and play with licensed operators.
Dahms concluded, “The goal of everyone involved should be to create an attractive secure marketplace for customers.”
“Effective action against illegal providers and an attractive range of products on the legal market can actually stop the growing migration of gamers to the unregulated black market.”