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German States Eye Easter 2012 For Gambling Treaty Launch

German States Eye Easter 2012 For  Gambling Treaty Launch

Germany’s state leaders had hoped to wrap up the new interstate treaty on gambling by October, but local experts note that there is still a mountain of work to be done before they can open the market.

Martin Stadelmaier, the head of the chancellery of Rhineland-Palatinate and a leading coordinator of the new state treaty on gambling, said Germany’s regional leaders will look to sign the agreement by December 16.

Stadelmaier also told the Rhineland-Palatinate parliament that the regions hope to ratify the treaty, which would license online gambling for the first time in Germany, by Easter next year.

German state leaders have already delayed their vote on plans to usher in a strict licensing regime for gambling a number of times, not least in the wake of criticism from European Union regulators.

The deadline for Germany’s regions to respond to the European Commission closed in mid-August, as they were forced to justify a series of restrictions on internet sports betting, casino and poker.

Meanwhile, the horse-trading between the states over what to change continues, with the next meeting between officials in the state chancelleries penciled in for September 7 followed by a full meeting of the 16 regional prime ministers at the start of October.

Local lawyers note, though, that many of the regulations which will underpin the new gambling treaty are still “under construction,” particularly while there is no regulator to draw up the licensing process.

Joerg Hofmann, a German gaming expert at Melchers law firm, told GamblingCompliance that the new market is likely to open in the first six months after the treaty is finalized or, even later, by the end of next year.

“This is all open and under construction,” he said, before adding that even if the new GlüStV is signed by December 31, when the current version officially ends, gambling companies will not be operating with a license the very next day.

There were fears the market would become a “Wild West” if new regulations were not in place by the end of 2011, but all of Germany’s regions, apart from Baden-Wurttemberg, have now extended the current treaty until the new version comes into force.

“It’s not that we won’t have anything after Christmas,” Olswang lawyer Christoph Enaux said, “but of course that still leaves us with the same legal questions as we have now.” Last year Europe’s highest court fueled private operators’ defense of their German operations when it punched holes in the country’s lottery and betting monopolies for being inconsistent.

While German politicians iron out details of a new licensing system for gambling, leaders of maverick state Schleswig-Holstein are forging ahead with plans to pass their own gambling law before the end of the month.

Stadelmaier said the other 15 states had not given up trying to secure a full regional consensus. “We want Schleswig-Holstein on board,” the Rhineland-Palatinate official said, “but not at any price.”

The precise timing of Schleswig-Holstein’s bill has been put into question, though, after one of its main sponsors resigned over revelations he had an affair with a 16-year-old girl.

Christian von Boetticher stepped down as chairman of the ruling Christian Democrats amid a growing furor over his relationship with the girl he met on Facebook. 

Its progress will be closely watched by private gambling companies eager to apply for a license in the northernmost German state and take advantage of its lower taxes and broader suite of games.

Online gaming firm Bwin.Party, which derived 23 percent of its pro forma revenue from Germany in 2010, has signaled it will take a license there in an effort to soothe market fears it would be floored by the financially onerous national licensing system.

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