Novomatic Leaves Germany’s Online Gambling Market Due to Unclear Regulatory Rules

A spokesman of Novomatic, the gambling technology company based in Austria, revealed that the group left the German online gambling market at the end of December 2017, urging the local regulators to bring more clarity to the online gambling legislation of the country.

In an e-mailed statement, the official representative of the company explained that German regulators had to invest more efforts into give a new and improved form of the local online gambling legislation, because the currently existing rules were not clear enough.

The operator was making plans to carry out a 5-billion initial public offering (IPO) on the Frankfurt bourse. However, in September 2017, Novomatic regulatory uncertainty in terms of gambling halls located in Germany made it scrape these arrangements. At the time when this happened, Germany was one of the key markets for the gambling technology group.

Currently, approximately 40% of the sales generated by the Austrian gambling operator come from gambling equipment. The rest of it is being generated from operating gambling halls. For the time being, online gambling operations account only for a small part of the overall sales of the group, primarily due to the fact that many countries have not made it legal still.

The company’s exit from the online gambling market of Germany was officially confirmed by a spokesman of Novomatic, who shared that the Austria-based gambling technology company stopped renting out its technology to web-based casinos in the country which use it for real-money gambling. The group’s spokesman also said that there were a lot of gambling services providers that were still using copied gaming content illegally on the online gambling market, without them having valid contracts with Novomatic.

Current Online Gambling Landscape in Germany

The online gambling regulatory efforts of German authorities have been going on for more than half a decade now. Although hope for finally bringing more clarity on the online gambling landscape remained, 2017 did not see much except for mere efforts and almost no actual results.

First, in February 2017, the Court of Justice of the European Union (CJEU) ruled that the state-wide monopoly imposed on sports gambling did not come in line with the EU law.

The spring of 2017 brought a new version of the Interstate Treaty of Gambling of 2012, which was produced under increased criticism for both the original and the following versions, got officially introduced. As previously mentioned, the existing versions of the 2012 Interstate Treaty of Gambling were criticised for not being in line with the rules imposed by the European Union treaty after the ruling of the CJEU.

The country’s authorities originally had decided to impose a limit on the number of sports betting companies that would be permitted to operate on the territory of Germany, with only 20 operators being given a license. However, this decision raised a lot of criticism, so there was hope for the new Interstate Treaty to eliminate these limits. For the time being, the latest version of the gambling legislation only boosted the number of online sports betting companies to be provided with operating license to 40.

The amendments brought to the 2012 Interstate Treaty on Gambling, however, were turned down at the end of September by the state of Schleswig-Holstein. The state also explained that it intended to roll-out its own gambling law which is to include an expanded number of web-based gambling options.

Then, in October 2017, the current ban on online casino, poker and scratch-card games was reiterated by the Leipzig’s Federal Administrative Court. According to the court’s ruling, no violation to the European Union treaty or the Constitution of Germany was made by the existing piece of legislation.

  • Author
Olivia Cole

Olivia Cole

Olivia Cole has worked as a journalist for several years now. Over the last couple of years she has been engaged in writing about a number of industries and has developed an interest for the gambling market in the UK.
Daniel Williams
Casino Guardian covers the latest news and events in the casino industry. Here you can also find extensive guides for roulette, slots, blackjack, video poker, and all live casino games as well as reviews of the most trusted UK online casinos and their mobile casino apps.

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