What has been achieved after two years of the State Treaty on Gaming?

The new State Treaty on Gaming (GlüStV) came into force almost exactly two years ago. Since then, the online gambling industry in Germany has changed dramatically. Although virtual slot machines and online poker can now be played legally on the internet, both providers and players are still struggling with the legal framework. So what have two years of the State Treaty on Gambling actually achieved?

The new GlüStV came into force on 1 July 2021. However, it was not until mid-May last year that a Gauselmann subsidiary was awarded the first German licence for online slots. And it was only in January of this year that the newly established Joint State Gaming Authority (GGL) became fully operational. These facts alone show that the liberalisation of the German online gambling market has not always gone smoothly. The new State Treaty has now been in force for almost exactly two years for German gamblers and gambling operators alike. It is therefore time for a first interim assessment.

GlüStV 2021: What has improved?

When it comes to the new online gambling legislation in Germany, most players will shake their heads. However, some of the negative criticism is somewhat exaggerated and driven more by emotion or a certain group dynamic. In any case, the fact is that some things have improved since the GlüStV came into force.

For example, it is a decisive positive development that virtual slot machines are legally available in Germany. Only a short time ago, players had to fear prosecution if they participated in online gambling. This also means that winnings can be paid out much more quickly in the legal online casinos and that there is a direct contact person with the Gaming Authority (GGL) in the event of problems.

Just a few days ago, the GGL announced that the official whitelist currently contains 142 providers of virtual slots and online poker, sports and horse betting, lotteries and commercial gaming brokerage (as of the end of June 2023). In addition, 45 further applications from gambling operators are currently being processed. In addition, there are more than 100 court cases in which the new regulations of the GlüStV are being examined.

In addition, well-known companies that have left the German online gambling market over the years are gradually returning. These include PayPal as an established and popular payment service provider and Greentube as a software provider. As a result, players can once again look forward to slots hits such as Book of Ra™, Lucky Lady's Charm Deluxe™, Lord of the Ocean™ and Dolphin's Pearl Deluxe™. For example, the popular StarGames recently obtained a German online slots licence, allowing players to play for real money in a secure environment under the supervision of a German authority.

GlüStV 2021: Pro-arguments

• Virtual slots can be played legally
• Well-known providers such as Greentube are back (incl. Book of Ra™ or Lord of the Ocean™)
• PayPal is back as a payment method in the regulated online gambling market
• German Gambling Authority as contact and supervisory body
• Better player protection is guaranteed

GlüStV 2021: What has changed for the worse?

Up to this point, one could get the impression that the introduction of the new State Treaty has had almost exclusively positive effects. However, the truth is that since the summer of 2021, there has been a lot of criticism from many sides. Not only gambling companies, but above all many players complain that the fun of gambling has suffered considerably since the new regulations of the GlüStV were introduced. As recently as April this year, we asked ourselves whether licensed online gaming arcades might even lead to more problematic gaming behaviour. But which specific aspects have worsened since the new legislation came into force?

First and foremost, many German gamblers are bothered by the numerous player protection measures laid down in the GlüStV. These include the minimum play time of five seconds, the monthly deposit limit of €1,000 per player, the maximum stake of one euro per game round and the newly introduced autospin ban. At the end of November last year, we published an article on this topic entitled "GlüStV: The most annoying player protection regulations" on GambleJoe.

The average return to player (RTP) has also deteriorated since the new gaming laws came into effect. The poorer payout ratios are mainly due to the newly introduced 5.3% betting tax on virtual slot games. As we reported in the summer of 2021, many associations criticised the impending "tax madness".

It should also be noted that German online arcades offer a smaller selection of casino games overall. This is because the German Gaming Authority only approves a comparatively small number of virtual slot machine games. However, the GGL has recently announced that around 1,500 games will soon be approved. This would certainly be a significant improvement on the current situation. Nevertheless, the new state treaty means that no live games such as blackjack, roulette or baccarat will be available nationwide for the time being, only slots and poker.

Furthermore, the number of operators with a German licence for virtual slot games is generally in the double digits. By comparison, there are at least four figures of online casinos with a European MGA licence or a licence from Curacao that have targeted the German-speaking market in the past.

GlüStV 2021: Contra arguments

• The fun of the game is compromised by numerous player protection rules (e.g. 5-second game duration, €1 maximum bet)
• German 'slot tax' of 5.3% of stake reduces payout ratio
• Limited game selection and generally fewer providers

Will the GlüStV be adapted or revised again?

Due to the numerous critical comments on the GlüStV, it is likely that the legislation will be revised again, at least in nuances. After all, the primary aim of the GlüStV is to strengthen the regulated online gaming market and make it more attractive. Recently, an article was published on GambleJoe stating that changes to the GlüStV are likely to be made soon. Of course, it is questionable which aspects will (or should) actually be revised.

Conclusion

Contrary to the opinion of many gambling enthusiasts, the new State Treaty has many positive aspects as well as negative ones. For example, players from Germany will be able to legally participate in real-money online gambling and access slot hits such as Book of Ra™, Eye of Horus, Gates of Olympus and other virtual slot games. In return, they must adhere to strict player protection measures and accept a lower payout ratio.

All in all, however, despite the obvious suggestions for improvement, the entry into force of the new GlüStV should not be criticised and rejected too hastily, but rather seen as an opportunity. What is important now is that the (still) existing rigid rules are adapted or revised step by step, but of course as soon as possible, in the interest of the players. Only then can the goal of an attractive and player-friendly legal online gaming market in Germany be achieved.

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