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The German state of Hesse began preparations to start the process of awarding the country’s sports betting licences, with analysts warning that operators could see up to 70 per cent of revenue disappear as a result of the restrictive operating model.
More than 200 company representatives attended last week informational meeting held by The Regional Council of Darmstadt, the body in the state of Hesse responsible for overseeing the licensing process under the third amended State Treaty on Gambling.
The new legislation will only be in place until 30 June 2021, as work continues on developing a new, permanent model to replace the existing State Treaty and Schleswig-Holstein’s liberal regulatory framework. The Treaty, which has been already signed by the Minister-Presidents of Germany’s 16 federal states, must still be ratified by each state government by 31 December in order to come into force from January 2020.
Interested game companies will have to submit a new license application, whether they have a previously approved one or not. Applications that meet all the requirements will be processed from January 2 of next year.
Applicants will be required to shut down all non-sports betting activity in the market upon receipt of a licence while in-play betting will be prohibited, customers spending limited to €1,000 per month and a 5 per cent turnover tax imposed on operators. In addition, operators will be required to provide an in-depth social responsibility plan.
According to the industry representatives, operating restrictions would create major problems for operators. Coupled with the social responsibility control plan ‘Sozialkonzept’, Germany would be “very unlikely as a profit centre for anyone” with betting revenue expected to decline by up to 70 per cent.
