Interstate treaty prompts 188Bet withdrawal from Germany

188Bet has become the first operator to pull out of Germany, with the Isle of Man-based operator refusing to accept new players as of yesterday.

The move follows the German Bundestag passing the Federal Horse Racing and Lottery Act last week, bringing into force a 5% turnover tax on sports betting for private operators, with the country’s controversial interstate gambling treaty also coming into effect from 1 July.

Under the terms of the treaty the State will award 20 sports betting-only licences to private operators, who in turn will be taxed on 5% of turnover. The licensing process will be spearheaded by the central state of Hesse, though the opening of the window for operators to apply for a licence is yet to be announced.

Sanctions for operators which continue to offer online gambling products to players are yet to be revealed after original plans for IP-blocking were deleted from legislation last year after being heavily criticised.

While it is unclear how the Länder will enforce the State treaty, a source close to the matter predicted that the States would be stricter on unlicensed operators, with an official legal framework in place.

While 188Bet has yet to explicitly announce that it will not apply for one of the twenty licences, it is currently “reviewing” whether or not to do so. A spokesman for the company was unavailable for comment this morning.

It is also currently unknown whether the company has submitted an application for a Schleswig-Holstein licence, under the terms of which it would be taxed on 20% of gross profits, and able to offer a full range of egaming products.