German Court Upholds Ban on Illegal Gambling Ads by Foreign Streamers
In a significant move to curb illegal online gambling, the Higher Administrative Court of Saxony-Anhalt (OVG Sachsen-Anhalt) has upheld a decision by the German States’ Joint Gambling Authority (GGL) to ban advertising of unauthorized gambling activities by streamers based abroad. This ruling, issued on July 11, 2024, marks a critical step in enforcing German gambling laws on a global scale.
The case centered around a prominent German streamer residing outside of Germany, who used the streaming platform “Kick” to promote and participate in illegal online gambling activities targeted at a German audience. The GGL’s prohibition order against this streamer was challenged, but the court confirmed its legality.
Key Points from the Court’s Decision:
- Territorial Principle Justified: The court ruled that the territorial principle of international law justifies the GGL’s actions. Since the content, produced in German, was directed at a German-speaking audience primarily located in Germany, the advertising impact was deemed to occur within German territory, legitimizing the exercise of German regulatory authority.
- Effectiveness in Hazard Prevention: The court also highlighted the necessity for effective hazard prevention. It noted that the GGL should not be expected to primarily target streaming platforms, but rather address the issue at the source – the streamers promoting the illegal content.
- Compliance with European Law: The court reaffirmed its previous stance that the ban on advertising unauthorized online gambling aligns with European legal standards. It emphasized that such restrictions are justified by compelling reasons of public welfare, particularly the protection of players and the prevention of gambling addiction.
GGL’s Commitment to Player and Youth Protection
Ronald Benter, Chairman of the GGL, welcomed the court’s decision, stating, ‘The ruling sends a powerful message! The GGL will intensify its efforts against foreign-based streamers promoting illegal gambling. Player and youth protection mandates this, given the unique dangers inherent in streaming.’
Streaming the participation in online gambling makes the emotions of the streamer visible and relatable, thereby normalizing gambling behavior and exposing viewers, especially minors, to potential risks. Benter stressed that streaming has become the most prevalent form of advertising, especially among younger audiences.
Impact on Youth
The court’s ruling referenced data from the UK Gambling Commission’s 2022 report on underage gambling participation. It revealed that 36% of 17 to 18-year-olds and 47% of 11 to 16-year-olds were influenced by streaming as a leading form of gambling advertisement. This underscores the significant risks posed to minors by such activities.
To combat this, the GGL regularly prohibits licensed gambling operators from advertising through streamers by incorporating specific provisions in their licenses. This landmark decision by the OVG Sachsen-Anhalt fortifies the GGL’s resolve to protect vulnerable populations from the risks of illegal gambling, setting a precedent for future regulatory actions against unauthorized gambling promotions.
A Critical Perspective: Regulatory Motives Questioned
There are critical voices suggesting that the real motives of the regulators might not be as altruistic as presented. Critics argue that the German gambling authorities are more focused on protecting their own revenue streams from gambling activities rather than genuinely safeguarding minors.
These critics point out that by cracking down on foreign streamers, the GGL is effectively reducing competition from external actors. This move, they argue, ensures that the regulated, domestic gambling market remains lucrative for the state, which benefits significantly from the taxes and fees generated by licensed gambling operators.
The emphasis on protecting minors, according to these voices, serves as a convenient cover for a financial agenda. The real aim, they claim, is to maintain control over the gambling market and maximize the state’s income from it, rather than genuinely addressing the risks associated with underage gambling and addiction.
This perspective adds a layer of complexity to the narrative, suggesting that while player protection is an important aspect of the GGL’s mandate, the financial interests of the state might also play a significant role in shaping its regulatory actions.
Furthermore, low Return to Player (84%-88%) and crippling regulations within the legal market have driven many German players to seek out alternatives on the grey and black markets. These unregulated markets often provide higher payouts and fewer restrictions, making them more attractive to players frustrated with the stringent rules and low returns of the licensed platforms.
