Schleswig-Holstein Jurisdiction Review
Located in northwestern Germany, Schleswig-Holstein is considered the Mecca of online gambling in the country, although not without its own legal struggles and certainly not a stranger to multiple revisions of the online gambling laws. In 2012, the European Gaming & Betting Association backed by the European Court of Justice pushed for Germany to adhere to European competition and free movement of services laws, forcing the country to loosen up its strict gambling laws and open up its gambling market. This turn of events lead Schleswig-Holstein to create its own liberal regulations, issuing around 50 licenses to online sports bookmakers, online casinos and online poker rooms. However, the following year the state decided to join the Interstate Treaty on Gambling (ITG), which is the main regulatory body in Germany and formally the holder of the monopoly of the country's online gambling industry, effectively rendering itself powerless in terms of regulating the market. With IGT at the helm, the said licenses were left in a gray area, deemed both valid and rogue at the same time. Because they were issued under specific circumstances and to avoid dealing with complicated legal proceedings, the licenses were allowed to play out their determined duration until 2018/19, but what happens after the period expires is anyone's guess. Bottom line is that punters can legally and freely play at a number of online casinos that were granted licenses by Schleswig-Holstein until 2018, and since the online gambling market currently brings considerable gambling revenue to Germany, it is possible the licenses will be prolonged after the said period expires.
Effective as of March 1st, 2012, Schleswig-Holstein Gambling Laws allow the state to legally regulate online gambling via two separate gambling acts for a period of 6 years which is set to expire in 2018/19. During this period, regulated casinos are protected under the law, but may not apply for the renewal of the license even though the law is open to future licensing. Two types of licenses are officially recognized: an organizing license (an event permit) and a distribution license (a sales permit).
The forms of gambling regulated under Schleswig-Holstein’s Gambling Act 1 are: Lotteries, Land-based casinos, Online casinos and Betting. A total of 25 licenses were granted for online casinos and another 20 for online sports betting. Initially, there was to be no limit placed on the number of issued licenses, but that clause was left ineffective in 2013 when the IGT overruled it, as well as many others regarding the future of online gambling in the state, that were in direct opposition to federal law. Some of the better known companies operating under the laws of Schleswig-Holstein jurisdiction are Bet35, Ladbrokes and PokerStars.
Foreign operators were allowed to apply for the license only if they had a registered office, central administration or place of business based in the EU or the EEA.
Protection of Players
The original aim of the law was to liberate the online gambling market of Germany in accordance with the EU freedom of operations, and the subsequent efforts in this regard made Schleswig-Holstein the first German state to regulate this market with self-created legislations. Aside from this, the most important element which naturally comes from such an aim is the protection of players and the channeling of gamblers into a legally regulated market meant to protect their interest as well as the integrity of casino games and sports, prevent addiction and protect young people from exploitation. Act 1 and 2 ensure is various ways that the operations are proper, fair, safe and responsibly done with a transparent conduct. As one of primary objectives, the law includes protection from frauds and criminal acts derived from gambling. According to Schleswig-Holstein, there was already an existing market flourishing in the country, but since it was bound by the strict federal laws it was susceptible to exploitation and fraudulent activity, it presented a problem which demanded legal regulations. Biannual reports are regularly delivered by the licensing authority which is the Ministry of Interior Affairs, containing data collected on player protection and safety measures taken by operators.
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