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Schleswig-Holstein softens stance as lawsuits begin

August 7, 2012 News & Reports

by Steve Hoare Gaming Intelligence

The Schleswig-Holstein interior minister Andreas Breitner has given the biggest indication yet that his government will not oppose the granting of online poker licences as the industry takes legal action to force its hand.

Breitner’s spokesperson told Schleswig-Holstein radio station NDR 1 Welle Nord that the administration could not claim it will block licences. His change of mood has probably been influenced by two recent suits filed by the industry.

It is understood that bwin.party and mybet have filed suits known as verpflichtungsklage in Germany. This particular type of legal action asks the Administrative Court in Schleswig-Holstein to force the government into action when a party feels it is stalling. It is understood that the applicants believe online poker and casino applications are ready to be issued but are being held up by the government.

A bwin.party spokesman said: “All we are doing is taking steps to ensure that our legal rights are protected. This is a natural and pragmatic course for us to take, because we have satisfied all licensing requirements, being found to be a suitable online gaming operator by Schleswig-Holstein as evidenced by the grant of a sports betting licence a couple of months ago.

“We are therefore entitled to receive a poker and casino licence according to the European Union-approved online gaming legislation that was democratically passed and enacted in Schleswig-Holstein.”

Mybet declined to comment.

The radio interview (August 1st) is the first time an SPD politician, which has the largest number of seats in the coalition government, has spoken out against the policies of its own party chairman Ralf Stegner, who fiercely opposes online gambling and has said the government will never grant online poker licences.

“Stegner must finally understand that we live in a constitutional state, not in a banana republic. Therefore, I encourage the deputy chairman of the SPD and Minister of the Interior Andreas Breitner to withstand the pressure from Stegner,” said Hans-Jörn Arp, the parliamentary leader of the opposition CDU party in the Schleswig-Holstein parliament.

Breitner’s statement is understood to have followed a meeting within the government when Stegner was told that the government could no longer oppose the passage of licences. One source suggested that Stegner “went ballistic”.

Arp seized on the opportunity to encourage Breitner to conclude the issuing of all outstanding licence applications without any further delay: “It would be more than painful if the government was accused by the courts of not issuing licences in breach of current law.”

The Green Party, which is the second largest party in coalition with the SPD and SSW, expressed concern about lawsuits from the industry costing the state millions of Euros. The Green Party’s Monika Heinold is minister for finance in the state.

In the meantime, local commentators predict the government’s desire to join the State Treaty could take more than six months to enact. Until then the ministry may be obliged to issue further licences – including online poker and casino licences – because it will be forced to execute the current law.

At a federal level, the German ministry of finance has drafted a bill aimed at amending money laundering legislation to include licensed gaming operators. This will force all operators, whether licensed in Schleswig-Holstein or those operating under a State Treaty sports betting licence, to comply with German money laundering requirements relating to the transparency of money flowing between players and operators.

The technical tools for doing this have not been published in detail but it is thought that it will include a ban on prepaid cards. As in Schleswig-Holstein, only e-payment institutions with a full banking licence will be allowed to operate.

“This is a step in the right direction,” said German lawyer Wulf Hambach of Hambach & Hambach. “But this can only be used in an efficient way if you have a sensible model of regulation like in Schleswig-Holstein. If you only grant 20 licences then thousands of operators will not have to comply with this legislation.”

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