Schleswig-Holstein has a problem. Its new government wants to join the rest of the German Bundesländer (states) and sign up for their ‘treaty’ or ‘Glücksspieländerungs-staatsvertrag’ which covers all forms of gambling, including the internet.
But if it does, it will be ‘taken to the cleaners’, as one observer of the market put it to us, by the 15 companies it has already licensed for sports betting.
Schleswig-Holstein is not the biggest German ‘länder’. It is the most northerly of the 16 German states; its capital city is Kiel and it has a population of only 2.8m people. But in legislative terms, Schleswig-Holstein has shown itself as something of a maverick, often bucking the trend of the rest of the country and going it alone when it suits.
It has a new state government, run by an uneasy alliance of parties, socialists, greens and a minority party representing the Danish-ethnic grouping (the state is next to Denmark). That coalition wants to undo the licensing carried out by its predecessor. The licenses were issued to several companies for sports betting including Tipico, Cashpoint and Bet3000. One licence has so far been issued by the state for internet gaming which is a breakthrough and it is now expected that other companies will receive licenses.
Meantime, the other 15 länder signed up for their joint Glücksspieländerungs-staatsvertrag, which is already very controversial, as it lays down the intention of pretty well wrecking the established arcades and street market for low-stakes, low-prizes gaming machines. It is a five-year plan encompassing all areas of gaming, the internet, casinos, the lotteries and the arcades.
It has already come in for a high level of criticism for plans to savagely cut the influence of the street market and arcades, which are, at least on paper, probably infringing federal law – but that is going to be the subject of considerable legal action between the länder and the industry in the next couple of years.
But Schleswig-Holstein wants to join up with the other 15 states and sign for the accord, which plans to issue 20 online gaming licenses to cover all of Germany. Schleswig-Holstein has already jumped the gun and issued some of its own. To renege on that now, cancelling the contracts with the licensees, is undoubtedly going to cost the state a small fortune - €60m in compensation has been bandied about.
Watch this space…
