German court ruling spells doom for federal sports betting licenses

A German court has ruled that the country’s online sports betting licensing process was fundamentally flawed, opening up the distinct policy that the entire process will have to be redone.

On Monday, the Administrative Court of Wiesbaden released its ruling on a challenge brought by an Austrian sports betting operator who failed to win one of the 20 federal online sports betting licenses awarded last September. The Court ruled that the licensing process had violated numerous laws, raised transparency concerns and violated European Union edicts against restrictions on the freedom to provide services.

The Court took particular offense at the Hessian Interior Ministry’s failure to disclose selection criteria in advance of the licensing process, as well as the Ministry’s lack of emphasis on operators’ need to identify methods of mitigating problem gambling behavior.

The Court’s ruling must still be ratified by the Higher Administrative Court but observers are already predicting the German government will be required to restart the licensing process from scratch. The 20 federal licenses have yet to be formally issued due to appeals by failed applicants, who took issue not only with the chaotic licensing approach but also the artificial cap on the number of licenses.