Germany approved a plan to open the online wagering market

Following a meeting in Berlin on Wednesday, the governor for the state of Rhineland-Palatinate, Kurt Beck, revealed alongside his counterpart from Saxony-Anhalt, Wolfgang Bohmer, that the states had conditionally approved a plan to open the German online wagering market for a five-year ‘pilot phase’.

Under the proposed changes, private operators would be able to bid for one of seven national licences in order to offer online sportsbetting to German residents from early next year in exchange for agreeing to pass on 16.6 % of their gross wagers to the state. However, the proposition would forbid in-play wagering on soccer along with bets on half-time results and the names of any scorers while the ban on television advertising would remain despite a provision that would permit operators to publicise themselves via boards in stadiums.

Beck and Bohmer stated that they were confident that the states would ratify Wednesday’s outline deal over the course of 2011 even with the northern state of Schleswig-Holstein withholding its opinion at the meeting.

Though changes to the State Lottery Treaty were welcomed within the industry, numerous operators including giant Bwin.Party Digital Entertainment have expressed discontent, especially at the proposed turnover tax. The newly merged company stated that the German propositions were ‘neither in compliance with European Union law nor in-line with market requirements’.

“Implementation of the principles presented by the minister-presidents yesterday is just as likely to fail as the outgoing monopoly model in Germany,” said Norbert Teufelberger, Co-Chief Executive Officer for Bwin.Party Digital Entertainment.

“A proposed tax rate of 16 % on the stakes placed in sportsbetting would make it impossible to offer a competitive product. Furthermore, excluding poker and casino products from this licensing model will continue to drive consumers into the black market. This would mean that the proposed model would fail to meet its objectives of channelling consumer demand, offering player protection and combating fraud.

“We trust that these proposals will undergo the necessary corrections so that the new regulations will govern the entire German gaming market in a coherent and consistent manner in line with European Union law.”

Bwin.Party also confirmed that it would apply for a licence in Schleswig-Holstein should the state continue with its current proposals which feature a 20% gross profits tax rather than a turnover tax.