Gambling regulations in Germany, Netherlands & Co: Does it really help to prevent addiction?

Today, many people in Germany enjoy sports betting and playing casino games for fun or profit - something which would have been unthinkable just two decades ago. Since then, casinos have not only spread throughout the country, but their number has also increased to more than 100. Gambling is popular among both young and old - men and women alike. According to research, one in every six Germans has gambled at least once in a casino in recent years.

Gambling Regulations in Germany, Netherlands & Co. and How They Affect Gambling Addiction

Many people believe that the gambling regulations in German casinos make them safe for all players. According to this view, since casinos are regularly inspected, they prevent addiction and money laundering. While the number of slots and tables has drastically increased over the years, authorities such as tax offices or law enforcement agencies do not seem to keep up.

On the contrary: the German Gambling Act and many of its implementing ordinances do not provide sufficient control mechanisms either in terms of their scope or effectiveness. The Federal Central Tax Office (ZKA) had to admit that it is simply incapable of monitoring the new forms of gambling.

Many experts also criticise the vague, haphazardly defined regulations concerning the criteria of suitability and control mechanisms for German gambling companies which are among the fastest growing companies in the country. For example, despite limits on prize awards, they have been changed so often that they now do more harm than good. All this is partly due to a lack of clear demands or sanctions.

The increasing number of casinos in Germany underlines the fallacy that the high number of controlled gambling halls prevents addiction and makes safer games. The mere existence of regulations is not enough to ensure that they are enforced.

Casinos Are Monitored by Law Enforcement Authorities

Another argument for gambling and betting regulation is assumed to be the fact that law enforcement agencies regularly monitor casinos. While this may seem reasonable at first, it has proven without a doubt to be ineffective in practice.

According to official statistics seen on thepunterspage, law enforcement authorities intervened in just 0.006% of all bets and casino games. However, this statistic is inadequate because it does not consider the number of security-relevant incidents that were not officially recorded or reported by operators. It also fails to consider the fact that law enforcement agencies are only authorised to assess compliance with gambling regulations while their main task is certainly to fight crime.

For example, the game-monitoring department of the City of Cologne regularly reports safety risks in casino games at private tables. Still, these cannot be addressed by law enforcement authorities because they are not monitored. The risk evaluation of the Gambling Commission (TÜV) also shows that most casinos do not comply with the legal framework.

Sites Are Regulated by the Federal Network Agency (BNetzA)

The third argument in favour of gambling regulation is that it helps avoid uncontrolled internet access to casinos. However, this approach has proven to be insubstantial because control of the internet content based on German jurisdiction is impossible.

Even though Internet access is practically costless and very quick, the Federal Network Agency has not been able to enforce German gambling laws online so far effectively. However, this does not mean that a complete switch to a non-regulation policy would solve all problems related to a liberalised market. Most of the websites provided by gambling providers are still located outside of Germany and do not fall under German jurisdiction.

Controls Keep Players from Getting in Over Their Heads

The final argument that is often used to support internet regulation is that it prevents players from getting into debt or ruining their lives because casinos keep an eye on players out of concern for their wellbeing. Many operators use this argument to claim that they provide an important service because they stop players from gambling even more than they would otherwise.

However, this argument is not true for casinos that just want to increase their revenues by offering different types of credit and expanding the limits on deposits. This is why it may be better to consider the restrictions imposed by gambling providers as a means of protecting their revenue.

The more restrictions are imposed on games; the more likely players will be looking for unregulated alternatives. This will not prevent addiction but rather make it worse because more competitive offers with higher limits will appear.

Bottom Line

The general ban on gambling is considered to be unnecessary because it does not prevent players from gambling through foreign operators. The same goes for the complete liberalisation of the market, which would only lead to more websites offering an even greater number of offers. These are often unregulated alternatives that are much worse for players who cannot control their gaming behaviour.

An appropriate solution would be to allow Germany's states to regulate the market because they better understand their individual circumstances. This should not be limited to operators based inside of Germany but rather include any company that offers games and bets to Germans over the internet. However, this does not mean that existing licenses from other countries should be recognised automatically.