Germany’s New Online Gambling Regulator to Cut off Payments to Unlicensed Sites

Posted on: June 29, 2022, 05:52h. 

Last updated on: June 29, 2022, 07:35h.

Erik Gibbs Read More
Expertise: Asia Pacific Gaming, Gaming Business, Global Gaming.

Germany’s new gambling regulator isn’t officially in place yet, but it isn’t waiting until it’s given the keys to the city to take over. Glücksspielbehörde (the Joint Gaming Authority, or GGL, for its German acronym) is going to block IP address and payment options for unlicensed online gaming operators as of July 1.

Nadja Wierzejewski
Nadja Wierzejewski, the head of Germany’s new online gambling regulator. She is preparing to implement changes, including blocks of IP address and payment options unlicensed platforms use. (Image: Games & Business)

Attorney and gambling law expert Nadja Wierzejewski will take over the management of GGL on July 1. At the same time, according to a statement from the agency this week, the new blocks will arrive.

The GGL doesn’t officially take over until January of next year. Despite this, the regulator is anxious to crack down on illegal gambling sites, and Wierzejewski is diving head-first into the fire.

Taking the Bull By the Horns

Since 2008, Wierzejewski has been Head of Gambling Supervision at the Supervision and Services Directorate of the State of Rhineland-Palatinate (ADD) in Trier, Germany. She has many years of experience in the fight against illegal gambling.

The team around the lawyer had focused in particular on terrestrial gambling. At the annual general meeting of the German Vending Machine Wholesale Association earlier this month in Berlin, Wierzejewski highlighted the significant decline in illegal gambling as one of her team’s successes this year. The group achieved it, she said, through controls and trusting cooperation with legal operators.

There are now only three licensed online gaming operators in Germany, and it took the country a year to get this far. Mernov was the first, but Tipwin and Mybet joined last week. They have limited options they can offer consumers, which means a strong majority of players will likely still turn to unlicensed sites.

Only online slots are currently available, and these have a stake limit of €1 (US$1.10) – not appealing to many gamblers. In addition, operators give up 5.3% of their net sales to the country in the form of tax payments.

GGL will introduce the changes before it explains them. It stated that it would provide information about the procedure to combat illegal gambling and the use of enforcement instruments on July 8.

In addition, it also spoke out against sites that advertise unlicensed operators. This seems to be a direct nod to affiliates, which means they need to be ready for blocks, as well.

More Gaming Controls Coming

Wierzejewski will also monitor Germany’s Interstate Gambling Evaluation System (LUGAS, for its Germany acronym). This is a system with which the gambling supervisory authority can evaluate the data operators submit.

LUGAS ensures that those operators meet deposit limits, as well as prevents consumers from using multiple gambling sites to circumvent those limits. Connection to LUGAS is mandatory for all online gambling providers.

However, LUGAS received criticism when Germany first presented the concept. The German Sports Betting Association reported considerable data protection concerns. The European Gaming and Betting Association (EGBA) also considers the requirements to be too restrictive. Despite the opposition, LUGAS is now in use and isn’t going away.