New Year Bringing Online Gambling Prohibition To Germany?

As of January 1, 2008, Germany may be enacting an anti-online gambling law that would prohibit the act of gambling over the Internet within their borders. In mid-December, all 16 state legislatures of Germany voted to approve the anti-online betting laws.

According to reports from the Bloomberg's business news service, the states negotiated the new laws after the Federal Constitutional Court overturned previous rulings. The new laws would prohibit all forms of betting online, including the operation of such betting services. Individual German states would have the ability to order banks to stop the transfer of money to/from illegal betting operations, as well as ordering Internet service providers to block such web sites.

The new laws state the definition of illegal gambling to be the wagering of money from within Germany's borders to any Internet based operation conducting business outside of Germany. This is exactly how most online gambling operations work.

Several major betting companies have criticized the new laws and are determined to challenge them, including Fluxx, Bwin Interactive Entertainment and Tipp24. Just last week, Tipp24 stated it regards the new regulations "as clearly contrary to law and will sue for its rights if necessary."

One of the sites operated by Bwin originally held an online gambling license from the issued by the communist East German government prior to unification, while another Bwin site operates under licensing from Gibraltar. According to Bwin, both permits prevail over the new laws and it will continue to provide online gambling to Germany. In October, Bwin sued 4 German states, pursuing their right to continue offering services to German residents. These cases are currently pending.

In an interview earlier this month, spokesperson for Bwin, Hartmut Schultz, stated, "We think that in the second half of 2008 the European Court of Justice will have stopped this futile effort to keep us out of Germany."

Earlier this year, the European Commission, regulator of the European Union (EU), urged Germany to reconsider its position on banning online gambling outright. Germany rejected that demand in April, claiming it was not disproportionate, but would rather protect their citizens from the dangers of gambling over the Internet.

Many experts believe the EU will escalate it's authority to halt the prohibition of online gambling in Germany, as the European Commission has the right to sue EU states in regards to non-compliance with EU laws concerning free movement of services between the nations.