Facing Blitzkrieg, Lottoland Runs Out Of Glück in Germany
Germany’s state gambling regulator—the Gemeinsame Glücksspielbehörde der Länder (GGL)—has declared total war on online lottery operators Lottoland — and called for all Internet service providers in Europe’s richest nation to block the group’s websites.
In what was their opening salvo on first being given cross-state responsibility for “combatting illegal gambling” on the Internet at the start of July this year, the GGL successfully ordered several payment service providers to cease working with Gibraltar-headquartered Lottoland.
They claim that offers made by Lottoland websites–lottoland.com, lottohelden.de and lottohelden.com—are bets on the outcome of a lottery draw instead of participating in the actual lottery draw.
And as such are illegal under current federal German betting legislation.
“The network of companies operating under the name Lottoland has been offering illegal gambling for years,” alleges the GGL.
“This offer is particularly precarious, as many players believe that they are participating in a lottery game at Lottoland. However, this is not the case.
“These offers are not permissible on the basis of the [Fourth] State Treaty on Gaming and have therefore already been prohibited,” they said in an official statement.
The GGL has now threatened draconian retaliation in its campaign to crush the online lottery providers.
“Raising awareness among Internet service providers is extremely important. Providers who fail to prevent access to unauthorized offers despite the GGL’s order face the threat of severe penalty payments,” warned GGL Board Member Ronald Benter.
Lottoland, for its part, claims that it is being singled out for special treatment because the GGL is “trying to maintain the monopoly of official state lotteries.”
“It is obvious that the state-owned GGL wants to create facts on behalf of the state lottery companies and federal states in order to protect the remaining lottery monopoly and to eliminate competitors in the lottery sector – for purely fiscal reasons,” they responded in a counter-charge.
Glimmer of Hope
Lottoland argues that banning access to their websites breaches EU law.
“Blocking orders are generally prohibited vis-à-vis providers in the protected area of the free movement of services in Europe,” they said.
And the lottery iGamers further argue that they created their Lottoland Deutschland GmbH subsidiary as a legal entity in 2020 — and have been paying tax in Germany throughout its operational history.
“[We will continue to] defend our case with state liability lawsuits in the three-digit million range,” they warned.
To which GGL CEO Benjamin Schwanke responded: “[Our] task is to consistently implement the State Gambling Treaty and thus law and order.
“Our priority in combating the [bad] market is enforcement against providers who are not on the official [good] list.”
Yet Schwanke also left a glimmer of legal hope for embattled Lottoland by conceding that all GGL actions were still “subject to judicial review”.
This one, mark the story, is set to run and run.