Germany pushes for increased regulation and reinforcement in the established market
Germany is gearing up for significant changes in its gambling regulations, with the aim to pass the new laws by December 31, 2026. The proposed changes, discussed in the Conference of Interior Ministers, include a Second State Treaty designed to strengthen the market's resilience to offshore incursions.
Under the proposed changes, the German Gambling Authority (GGL) will be granted new powers, including the ability to issue IP blocks. This move has been met with both support and criticism. Matej Novota, Head of Casino Research, has stated that effective IP blocking in Germany will not improve channelization, as players prefer offshore casinos over the licensed market.
The issue of overlocking, where legitimate businesses could be impacted by IP blocks, has been cited by critics of the measure. IP blocks have been heavily criticized, as they could potentially impact legitimate businesses. A gambling ad appearing on a website could have been a mistake, but the resulting block could have serious consequences for the affected business.
The GGL has maintained that it would use its powers to issue IP blocks fairly. To enforce these blocks, the regulator would need to collaborate with intermediary services, such as Internet Service Providers (ISPs). The GGL may also raise red flags over operators licensed elsewhere but targeting the local market without permission.
Independent industry research suggests that about half of all gamblers are playing at offshore companies. This erosion of market share to illegal or offshore platforms is a growing concern across Europe, especially in the case of crypto-enabled gambling in Spain. To address this issue more effectively, the GGL could cooperate more closely with international regulators.
The GGL will also be allowed to tap overseas counterparts about a brand's or operator's eligibility based on the overseas homologues' experience. This collaboration could help ensure that only legitimate operators are allowed to operate within Germany's regulated market.
The GGL has dismissed the claims about the rate of channelization, arguing that the methodology used to come up with the number was flawed. Despite this, the regulator's focus remains on shifting players into safe, legal environments.
The upcoming Gaming in Germany Conference, scheduled for November 11, 2025, will provide a platform for further discussion on these issues. As Germany moves towards implementing these changes, the focus will be on striking a balance between consumer protection, regulatory efficiency, and market resilience.
- The proposed Second State Treaty in Germany aims to strengthen the market's resilience against offshore incursions, and under this, the German Gambling Authority (GGL) will have the power to issue IP blocks, which has been met with criticism due to potential impacts on legitimate businesses and worries about overlocking.
- To ensure that only legitimate operators are allowed to operate within Germany's regulated market, the GGL could cooperate more closely with international regulators, as the issue of erosion of market share to illegal or offshore platforms is a growing concern across Europe, including the case of crypto-enabled gambling in Spain.
