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Germany’s gambling market could be heading for another round of regulatory debate.
A proposal put forward by the Economic Council, an organisation closely associated with the CDU, is calling for changes to the country’s 2021 State Treaty on Gambling as the long-awaited review of the legislation approaches its conclusion later this year.
The intervention reflects a growing sense that the current framework has not produced the results many policymakers hoped for when the treaty was introduced. Germany’s regulated market has struggled to establish itself, while concerns over the scale of illegal gambling activity continue to grow.
At the centre of the criticism is the taxation model applied to online slots. Licensed operators are required to pay a 5.3% levy on stakes rather than gross gaming revenue, a structure that many in the sector have argued places legal businesses at a disadvantage. Operators also face a €1 maximum stake per spin for online slot products.
Industry groups have repeatedly pointed to the gap between the legal and illegal markets. The German Sports Betting Association estimates that unlicensed betting sites outnumber authorised providers by a factor of eleven. Research firm H2 Gambling Capital has put channelisation levels at between 22% and 25%, while forecasting a decline to around 20% by the end of the decade.
Looking Beyond More Restrictions
The proposal argues that Germany should reconsider how it balances consumer safeguards with market realities.
Its authors suggest the treaty’s twin principles of freedom and responsibility have become weighted too heavily toward restrictions, and that adult consumers’ ability to access regulated products deserves greater consideration alongside player protection measures.
Another recommendation is the introduction of ongoing independent research rather than relying solely on periodic reviews. A rolling evaluation process, the paper argues, would allow policymakers to assess the impact of regulations more regularly and make adjustments when necessary.
There is also a clear emphasis on tackling the illegal market. Instead of tightening rules for licensed operators, the proposal favours measures aimed at reducing the appeal and accessibility of unregulated offerings.
Licensing procedures are highlighted as another area in need of attention. The document advocates a simpler system and criticises the fragmented approach to product approvals, which some stakeholders believe has made market entry unnecessarily difficult.
The debate arrives as Germany’s gambling regime faces increasing scrutiny from both domestic trade groups and international industry bodies. The European Gaming and Betting Association has previously questioned whether meaningful progress can be achieved without changes to the current structure.
With the treaty review expected to wrap up before year-end, the discussion is shifting toward whether the existing rules can realistically channel players into the legal market, or whether a broader rethink has become unavoidable.
