The legality of online gambling in the EU

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According to EU law, online casinos wishing to offer their service in the European Union must have an online gambling license that meets the security and quality standards of the European Commission. The regulations of the European Gaming Authority meet these requirements. However, if you live in Germany or the UK and try to join an online casino with licenses issued in Malta or Sweden, it is quite possible that you will not be able to access their games. Which parts of EU gambling law create these discrepancies?

A recent example

casino masterthe examination of Twin Casino gives us a glimpse of their quality as an online game provider. Ratings from gambling community administrators and their users, as well as other accredited status, marks them as an online casino with exceptional odds and impeccable service. One of the main points of the examination is the legislation of the casino. This category lists the separate gaming licenses that the casino has acquired.

It is not uncommon for an online gambling provider to have multiple licenses. Indeed, the legislation of some countries requires them to have a specific license to legally offer their services. In Twin Casinoit is, it is Malta Gaming Authority license and the Swedish Gaming Authority Licence. Both are reputable licenses that expect their applicants to have high standards of safety and overall quality.

However, if you try to access the casino from the UK or Germany, the following message appears:

“We regret to inform you that we have discontinued our gaming offering in your residential jurisdiction until further notice. If you have a balance in your account at twin, please contact our customer service team for assistance with payment.

What has led to these exclusions is a series of recent legislative changes, including Brexit.

Gambling legislation in the EU

One of the main factors that adds uncertainty to the legality of online gambling is the lack of a conclusive international gambling law. The laws of many countries directly oppose the views of others on the subject.

EU legislation

There is no European legislation regarding gambling services More precisely. Instead, the EU leaves the creation of gambling laws to its members on its own. Except that there is a law that applies to online gambling providers. the Treaty on the Functioning of the European Union (TFEU) is the list of fundamental freedoms within the Union established by the EU court.

Relevant to the online gambling industry is the next:

  • Any EU citizen can freely open a business or offer their business services in any other EU country.

The way this law has been applied to gambling implies that aAny online casino with an EU license is allowed to operate in all EU countries, regardless of their own legislation. But it’s never that easy when two opposing laws from different courts come into conflict. In Germany in particular, this has led to a gray area when it comes to the legality of online gambling.

German law versus EU law

The problem in Germany has been, and continues to be, that it is not settled and drafted in a legally binding form, under which circumstances exactly EU law overrides national legislation. Many online casino providers take advantage of this legal uncertainty to offer their gaming sites in Germany, until someone makes an indefinite decision and applies it. Some providers, such as Twin casino, recognize that the latest German gambling law is exactly that.

In July 2021, Germany legalized online gambling for the first time. Any provider who had previously offered their games to German citizens did so – according to national law – illegally, but EU law generally left them indifferent to German law enforcement. The new law stipulates that only casino providers who have the new German license are allowed to operate there legally.

As Germany finally defined under what circumstances online gambling is allowed, many casinos that did not meet these criteria changed their position and withdrew their service from the German market. There are two reasons why they won’t register for the license instead:

  1. The license is expensive. | As the law is still young, all the details have not yet been provided. According to the bill, the service provider must pay a deposit in the form of a bank guarantee of min. 5 million euros. Depending on the expected income, this can go up to 50 million. This does not include the cost of modifying the casino to meet the criteria of the settlement.
  2. The license has many restrictions. | The German license has a strong focus on the prevention of gambling addiction and the protection of minors. This is why they require restrictions such as a maximum monthly deposit of €1,000 or the removal of particularly addictive games and features.

Casinos that are currently banned from German players might decide to stay that way, so they won’t have to remove game types and restrict their players too much. Or they may be waiting for the proper implementation of the law and trying to meet licensing criteria.

Brexit issues

A bit like in Germany, since 2014 Gambling law past, the national license issued by the UK Gambling Commission is the only license that allows casinos to legally offer their services in the UK. It was not possible to predict every little change that would be triggered by the UK’s exit from the European Union. Especially not concerning subjects with such unclear legislations in the first place.

By leaving the Union, the United Kingdom lost the treaties that created partnerships between EU states. Without the TFEU, casino providers from the UK or other countries had to reorganize their business. There were a lot of questions to ask:

Are UK casinos now illegal in other EU countries? Are UK licenses held by international casinos still valid? What about Gibraltar’s status as an overseas territory? How does Brexit affect the many casino businesses registered there due to local tax relief? Will changes in laws and taxes drive businesses out of the country?

Just like after the newly introduced law in Germany, not all of these questions can yet be conclusively resolved. Business and government issues slowly resolve themselves after many meetings and reviews, until the terms are finally set in stone and can be enforced or enforced. Many casinos have discontinued their services in the UK, as they are unsure whether or not they need to renew their UK license after Brexit.

Conclusion

It is unlikely that there will ever be an international authority on online gambling laws. As long as individual jurisdictions create their own rules, there will be anomalies like this gray area created by the overlapping of several laws of different origin and the bureaucratic obstacles between the passage of a law and its proper application.

Fortunately, the effect this has on players is relatively small. They may be embarrassed by the imposed limits, lose their favorite games or have to move to another online casino. The biggest burden is on the online game providers. Their livelihood depends on these changes and forces them to navigate these complicated circumstances. Many of them will lose players and revenue, pay taxes or higher fees for additional licenses.

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