No Rejoining to German Treaty for Schleswig Holstein After All?

Due to European Commission’s concerns whether changes to gambling law in the German state of Schleswig Holstein comply with EU law, the state’s intention to rejoin the German Treaty on gambling, which is also in controversy with European treaties.

The EC’s ‘detailed opinion’ against the SH Draft Gaming Amendment Act, which seeks to replace existing liberal and EC-approved legislation on internet gambling with the restrictive and controversial German State Treaty on gambling, has been welcomed by the European Gaming and Betting Association, which represents most of Europe's major betting firms.

In its opinion, the EC reinstates the concerns about the Lander’s proposed switch from a transparent licensing model to a restrictive one, and expresses doubts about the overall compliance and consistency of the German gambling regime with EU law.

Based on Directive 98/34/EC, Schleswig-Holstein must not adopt its draft legislation before January 2013 and it needs to respond to the EC’s latest opinion, providing details about its intentions. The Lander is also forbidden to implement the proposed legislation for six months, calculated from the original date of its submission to the EC, which means that the delay could last till March 2013.

As for the objections to the German Treaty which SH wants to join, they include reservations about its prohibitive and restrictive model which bans online poker and casino action; the imposition of an uncompetitive tax regime; and restrictions on online sports betting licenses to just 20 issues.

Commenting on SH’s proposal, Sigrid Ligné, secretary general of EGBA, said: “Schleswig-Holstein’s proposed move from a sustainable and EU compliant licensing system to an inconsistent and unjustifiably restrictive regime would be a significant step backwards, one that - as confirmed today - the European Commission cannot approve.”

According to here, the EC position on the non-compliance of German law with EU requirements was consistent with its view as stated back in July 2011.

“The European Commission’s detailed opinion against Schleswig-Holstein sends a clear message that Member States are no longer going to be allowed to impose gaming regulations that fail to meet the tests set by the European Court of Justice," Ligné said, adding:

"The German states cannot continue to ignore the warnings coming from Brussels and the growing criticism, evidenced by the multiplication of complaints and litigation even before the new legislation is introduced. This creates an extreme level of legal uncertainty which is damaging for all parties and German consumers in particular.

"At this stage, only the EC can restore legal security by acting on the many complaints it has received, not only against Germany, but also against Greece, Belgium and several other Member States.”

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