The newly formed Christian Democratic Union (CDU) and Free Democratic Party (FDP) coalition in the state of Schleswig-Holstein has announced its intention to contest the German online gambling ban in order to introduce a revenue-raising licensing system. The 2008 ban and other provisions of the German Interstate Treaty on Gambling had led to a 30% reduction in gambling tax revenues, according to the Deutscher Lottoverband (DLV), the German gambling industry body.
The German gambling monopoly has been contested on several occasions by the European Commission and in the German courts. Now, the northernmost of Germany's 16 states is calling for an end to the online gambling ban. The local CDU/FDP coalition has included in its recently concluded coalition agreement the following statement:
"Schleswig-Holstein is giving notice that it no longer wishes to be part of the Interstate Treaty on Gambling and urges a uniform reform of the existing federal law… if no uniform federal solution can be found, then the Schleswig-Holstein Coalition will look into developing its own licensing model for the industry."
Currently, only horse-racing bets are permitted online in Germany and the Interstate Treaty is designed to maintain monopolies by means of advertising and commercial sales bans. Germany uses the argument, that this is the best way to protect consumers and minors while combating addiction, to justify itself before the European Commission.
The Treaty lapses by the beginning of 2012 if the German states decide not to extend it.
A comprehensive report in our Intelligence Report series examining the new possibilities that offshore e-commerce open up for business, and analysing the offshore jurisdictions that have led the way in offering professional e-commerce regimes for international business, with a particular focus on e-gaming, is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report6.asp
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