Bwin says changes may make German market unviable

The German states - which are in control of gambling in the country - have to draw up a new regulation before current rules expire at the end of this year. The agreement made on Wednesday may be signed by state premiers at a meeting on June 9. Germany has argued it is protecting customers from fraud and addiction by keeping lotteries, sports betting and other kinds of gambling limited to only state-run operators.

The proposals include plans to tax sports betting from next year at 16.67 % of turnover, ban in-game wagers and only allow online casino products to be offered by operators with an existing land-based licence. In addition, television advertising for online sports betting sites may be outlawed.

"Implementation of the principles presented by the minister-presidents yesterday is just as likely to fail as the outgoing monopoly model in Germany," said bwin.party chief executive Norbert Teufelberger in a statement on Thursday.

"A proposed tax rate of 16.67 % on the stakes placed in sports betting 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."

Bwin.party, formed by the merger of Austria's Bwin and PartyGaming earlier this month, said it believed the proposals were neither in compliance with European Union law nor in line with market requirements.

"We trust that these proposals will undergo the necessary corrections so that the new regulations will govern the entire German market in a coherent and consistent manner in line with EU law," said Teufelberger.