SBC News Entain: GGL must address German gambling’s black market exposure 

Entain: GGL must address German gambling’s black market exposure 

Entain Plc has backed the findings of the ‘Schnabl Study highlighting the significant presence of black-market operators targeting Germany’s Fourth Interstate Market (GlüNeuRStv).

Published by the trade bodies of DSWV (sports betting) and DOCV (online casino), the study conducted by Prof. Gunther Schnabl of the University of Leipzig, found that ‘around half of the online gaming activity in Germany takes place on illegal platforms’.

Since the implementation of GlüNeuRStv rules on 1 July 2021, German consumers are believed to have flocked towards unlicensed EU (28.9%) and offshore (19.9%) operators.

Providing a damning assessment of the GlüNeuRStv regime, the study cited that ‘the youth and player protection measures upheld by legal providers, such as limits, player bans, and offers of help, are therefore ineffective’.

SBC News Entain: GGL must address German gambling’s black market exposure 
Grainne Hurst – Entain

Entain, which operates the German ‘top-three’ online sportsbook Bwin among its European portfolio, states that current GlüNeuRStv protections are overly restrictive, making legal gaming offers less attractive and driving consumers towards the black market.

The statement was made by Grainne Hurst, Entain’s Group Director of Corporate Affairs, speaking to the German news source “Against this background, Entain calls for German gambling regulations to be consistently geared towards player protection in the future and to strengthen legal offers on the market. Their attractiveness is currently being severely limited by regulatory requirements, which is leading to users turning to black market offers.”

The deficiencies of the current GlüNeuRStv regime are evident as “current tax figures in the area of virtual slot machine games also show that sales in the permitted market have recently fallen significantly again, which is a further indication of a move to the black market.” 

Interstate regulatory adjustments have blighted Entain’s online gambling performance in Germany throughout 2023, as the FTSE decries a ‘lack of effective enforcement in Germany post licensing’.

Hurst noted that the Schnabl Study pictures the reality of legal operators in Germany, dealing with players switching to black-market alternatives, as restrictions such as minimum play times and maximum stakes for virtual slot games are pushing players to illegal providers.

“We have recorded significant declines in sales since the new State Treaty on Gambling came into force in Germany around two and a half years ago. When looking at individual gaming behaviour, it becomes clear that players are obviously switching to illegal providers and continuing to play there due to certain access barriers that the current regulation entails.” 

Entain continues to emphasise the need for regulations to prioritise player protection and make legal gaming offers more attractive. Hurst insists that the right implementation of regulations can lead to better channeling of players towards legal platforms.

However, last week the Glücksspiel (GGL), the Federal Authority for German Gambling, rejected criticism of its data-collection approach of the Interstate market, in which it stands by its assessment that the ‘market volume of illegal gambling’ is estimated to be at circa €300m-€500m, in the range of 2%-4% of the current legal market’s size.

The authority stated that it is aware of 800 to 900 illegal websites targeting German consumers, however, it stands by its data-collection methodology as the most comprehensive view of GlüNeuRStv development.

DSWV and DOCV responded, stating that the GGL could not draw on any accurate estimate of the Interstate market, due to the size of the black market visibly targeting an ineffective regime.

Concluding its statement, Entain stated that it would like to engage in dialogue with the GGL to combat illegal gaming offers and enhance the attractiveness of legal platforms for improved player protection.

“We are committed in Germany to ensuring that, following the groundbreaking adoption of the State Treaty on Gambling, implementation is now consistently geared towards the best possible player protection with appropriate channeling.

“With its knowledge and experience from international markets on this topic, Entain is always available in Germany for a corresponding dialogue with the responsible regulatory authorities and continues to support the GGL in the fight against illegal offers.”

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