New court ruling: providers are not obliged to block foreign providers
The German State Gambling Authority in Halle does everything it can to protect German players. This includes not only reviewing licence applications and, depending on the provider, granting a licence or not. One of the agency's tasks is to fight illegal gambling. One of the ideas was to create an online block against foreign operators, which should be implemented by providers. On the other hand, the 1&1 provider went to court and won.
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The provider has won the Supreme Administrative Court in Koblenz
The German Gambling Authority tried to require all ISPs to block access to the websites of foreign gambling providers. If this were possible, no German player would be able to access a foreign online casino. It would therefore generally not be possible to play with so-called illegal providers. The regulator would tick off one item on the to-do list: if no player can access unlicensed foreign gambling, they will also not be able to play with an illegal gambling company.
The obligation not to allow access to unlicensed foreign gambling providers actually stems from the legal framework in Section 9 Paragraph 1 Point 3 No. 5, which is enshrined in the new German State Gambling Act. This section allows the German Gambling Authority to demand a ban from providers. This, in turn, is a result of the Telemedia Act. However, according to the court, none of them will apply because the provider in question is already a responsible service provider under the Telemedia Act. Thus, the provider would have already fulfilled all obligations, and the gambling supervisory authority could not impose any of its own or other obligations here.
No unlawful actions found
The court further notes in its decision that the gambling supervisory authority may establish additional requirements and rules if the provider fails to fulfil its obligations under the Telemedia Law. Especially if the cooperation with another company is recognisable. However, the purpose of such cooperation must be to commit criminal acts. For example, a provider could cooperate with an unlicensed gambling company to make it easier for them to offer their services. But the court did not find this in this case.
The affected provider is clearly happy with the court decision, as the gambling supervisory authority threatened to impose fines. After the authority had just started its work earlier this year, it introduced itself to providers operating in Germany. This presentation simultaneously threatened fines if the providers did not implement the required internet blocking. In this letter, the supervisory authority referred to the Telemedia Act, which may require blocking if the measure against the organiser is considered unfeasible or futile. According to media reports, the authorities offered cooperation to providers if they "voluntarily" implement the blocking. In this case, only your own costs will be incurred.
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Possible fines of up to 500 000 euros
Of course, the German gambling authority would inform providers which online casinos should be blocked. However, those who fail to do so should expect retaliatory measures and lawsuits. Depending on how many authorities are involved, a fine of 500 to 500,000 euros could be imposed. Such high fines are not in line with the Law on Telemedia, so experts cannot understand why the supervisory authority sets such amounts. According to the Telemedia Law, it is gambling providers, not suppliers, that should be fined for violations. That is why the Internet Industry Association is strongly critical.
This concerns not only the extremely high fines threatened by the authorities. The Association also makes it clear that blocking websites does not always bring the desired result. According to experience, gambling providers react to blocking by creating a new website and thus immediately become available again. In addition, anyone can apply for VPN or DNS encryption. This also means that unlicensed online casinos are still available. In this case, the gambling authority will have to apply for a blocking order again, and the providers will have to face a fine again.
Should providers be involved in the fight against illegal gambling?
The GGL, the German gambling supervisory authority, has stated in its letter to providers that they should also take part in the fight against illegal gambling. That is why it offered cooperation, even though both represent the opposite of the Telemedia Act. This is how the court sees it, so the plaintiff provider 1&1 was right. Of course, all other providers can refer to this decision and no longer fear a fine. However, it should be noted that this is still an urgent application decision. Therefore, the main proceedings are not yet complete. However, we can expect that it will be similar.
It should also be noted that it makes no sense to block only the websites of foreign gambling providers. These are often providers that not only have a place of business in Malta, but are also licensed in Malta. The licensing conditions of the Malta Gambling Authority are quite strict, so in fact, only safe gambling providers can offer their range. Therefore, players usually have a high level of protection. As a result, it does not necessarily have to be a provider with no player protection if no licence has been issued for Germany.
Other countries rely on IP blocks
There are other countries in Europe that are already working with website blocking. They have already gained enough experience that blocking does not always make sense: on the one hand, providers can defend themselves very well and prepare new pages in a very short time, and on the other hand, players can still log in. All they have to do is use a VPN or register as if they live in another country. Then you can use any online casino you want, as the laws of your actual country of residence do not apply. The only thing that matters is that the invented country allows you to use online casinos.