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Administrative procedures for blocking the offers of a large provider of non-permitted lottery bets have been initiated

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Since 1 July 2022, the Gemeinsame Glücksspielbehörde der Länder (GGL) has been responsible across the Länder for combating illegal gambling on the internet and advertising for it.

How the new authority will proceed in concrete terms, and what its priorities will be, were presented by the board members Ronald Benter and Benjamin Schwanke at a digital press conference on 8 July.

"The prerequisite for combating illegal gambling on the internet is the creation of a legal market. Our goal is to ensure that the business model of offering illegal gambling on the internet is not profitable in the long run," said Ronald Benter.

Benjamin Schwanke explained his approach: "Our priority in the fight against the black market is enforcement against providers who are not willing to regulate. We will remove players from the market who do not comply with the rules of the State Treaty on Gambling, who have not applied for a licence or who have been rejected. Criteria for prioritisation in enforcement include market size, awareness and advertising behaviour/volumes."

In addition, complaints about unauthorised providers are prioritised. For this purpose, the GGL offers a whistleblower system on its homepage to receive tips on unauthorised gambling and gambling advertising in a structured manner and to take legal action promptly.

The GGL's declared goal is to achieve visible results within the next 6 months. With consistent enforcement, the authority also wants to strengthen the permitted providers who adhere to the rules of the State Treaty on Gambling and thus incur more costs and effort and for whom the hurdles to gambling are higher for reasons of player and youth protection.

One of the measures in the fight against illegal gambling is criminal charges, which the GGL will file with the competent prosecution authorities. Criminal prosecution is then the task of the public prosecutors and the police. Criminal proceedings and convictions can also be brought against providers from other European countries in absentia. In order to support the work of the public prosecutors' offices, the new authority will work closely with the competent prosecution authority in Saxony-Anhalt and share its market knowledge about providers and their group links. The GGL is promoting the establishment of a focal prosecution office in Halle (Saale) in order to put the prosecution authority in a staffing position to take criminal action against illegal gambling offers. The authority is currently initially assuming a three-digit number of criminal charges annually.

The enforcement tools available to the authority itself for combating illegal gambling have been significantly strengthened by the first-time bundling of all enforcement tools, such as IP Blocking and Payment Blocking, in the GGL.

In the case of IP Blocking, the Internet providers are ordered to block access to the illegal offer via Internet access within the framework of a regulatory order. In order to ensure the implementation of this order, the authority can impose severe penalty payments on the respective providers. Preparations for the first IP blocking proceedings against providers of illicit gambling have been completed.

The administrative proceedings to block lottery bets of a large network of companies operating under the well-known brands Lottoland and Lottohelden, which are not eligible for authorisation, were initiated by the authority at the beginning of July. This was preceded by prohibitions issued against these providers by several Länder. The access intermediaries (internet providers) were ordered to block the corresponding internet sites.

In the case of payment blocking, the payment service provider handling the payment transactions is ordered to block the payment of the player to the gambling provider and vice versa. Until 30.06.22, blocking payment flows was the responsibility of the Lower Saxony Ministry of the Interior. In the past, the Ministry has successfully requested payment service providers to block payments out of court.  GGL is now building on this approach with a concentration of staff, responsibilities and knowledge. "We are interested in cooperative collaboration with the payment service providers, but we can also initiate appropriate administrative proceedings if the payment service provider does not fulfil its obligations, and we have effective instruments for enforcement with the penalty payment and administrative offence proceedings and criminal proceedings," says Schwanke.

Another instrument of the GGL in the fight against illegal gambling are the reports to tax offices for the prosecution of tax offences. The possibility of cooperation with tax offices was strengthened in the GlüStV21. "From our point of view, the reporting of gambling providers to the competent tax offices is one of the most effective instruments to fight illegal gambling on the internet. Because with tax debts, the probability of obtaining a permit in the future is close to zero," explained Benter. Those who have tax debts in Germany risk not being granted any more licences abroad. Licences that have already been granted can also be revoked.

All in all, Benter and Schwanke were very optimistic that the regulation of cross-border gambling on the internet would be successful. This is supported by the fact that competences and resources for combating illegal gambling have now been bundled in the GGL. In addition, the political tailwind continues to be noticeable.

About the administrative procedure to block lottery bets by Lottoland that are not eligible for authorisation

The network of companies operating under the name Lottoland has been offering illegal gambling for years. This offer is particularly precarious, as many players believe that they are participating in a lottery game at Lottoland. However, this is not the case. The offers of Lottoland under lottoland[dot]com, lottohelden[dot]com and lottohelden[dot]de are bets on the result of a lottery draw instead of participating in the actual lottery draw. These offers are not permissible on the basis of the State Treaty on Gambling and have therefore already been prohibited. However, they can still be accessed on the internet. For this reason, the first legal steps of the Joint Gambling Authority of the Länder were directed towards the prohibition of the Lottoland offers through the administrative procedure on IP blocking.


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