GERMANY Law and Practice Contributed by: Jörg Hofmann, Matthias Spitz and Michelle Hembury, Melchers
Esports Esports is a growth sector, and betting on esports is becoming increasingly popular. However, it is currently unclear whether esports qualify as sports in terms of the various legal privileges granted to sports within the German legal system, such as the opportunity to offer betting. Nevertheless, an increasing number of voices in sports and legal sciences are opening up to such a classification, at least when it comes to cer- tain esports titles. Irrespective of this, legislators are also showing a new openness towards esports, and more specifically to at least put esports on an equal footing with sports by creating esports-specific laws that grant esports the same rights. One notable step in this regard is reflected in the German government’s drafting a law by which esports will fall under the defi- nition of a charitable commerce. This trend is being fuelled by, among other things, the IOC’s announce- ment that the first Olympic esports Games will take place in 2027. This, in the long term, is being consid- ered to pave the way for esports becoming at least an equivalent to sports. However, for the time being, betting on virtual sports remains prohibited. Fantasy Sports Depending on how a fantasy sports offering is designed, it may fall outside the scope of German gambling regulation. A key criterion will be whether the payments made qualify as a stake given in exchange for a chance to win. In the case of a football manager game that spans an entire football season, the Federal Administrative Court did not assume it was a game of chance. Skill Gaming A game will be considered a game of skill if the likeli- hood of winning predominantly depends on skill rather than chance. If this can be established, the game will not fall within the definition of a game of chance and, as a result, will not be subject to gambling regulation. Blockchain or Cryptocurrency Blockchain technology has so far only played a role in the cryptocurrency context with regard to gambling in Germany. As German regulators have traditionally taken a critical stance on cryptocurrencies, they are not expected to be relevant in the near future in the regulated gambling sector.
realms of advertising. Due to numerous open ques- tions in connection with the unclear ancillary provi- sions of advertising, legal uncertainties can also be expected in the coming months or years. The ancillary provisions under advertising law are therefore also the subject of numerous pending court cases in Germany, of which some have progressed during 2025 to sec- ond instances before the competent courts. In addi- tion, the regulator has increased enforcement against both licensed and unlicensed operators by means of advertising regulations, thereby clearly stepping up monitoring of the marketing landscape in the gam- bling industry. Recent Changes The most significant change to the gambling market is the new Interstate Treaty and the simultaneously ratified new taxation law, which flanks the operation of all permissible games of chance by a 5.3% tax on players’ stakes. As of 1 July 2021, the tax obligation applies to all gambling operators, regardless of their registered office, as soon as the gambling offer can be accessed within Germany. The tax obligations gener- ally must be observed by any operator irrespective of whether they hold a licence. The new tax rate will result in burdening the player with the tax rate or a reduction of gross gaming revenue (GGR). Not only were new licensable games of chance introduced, but so was a new regulator, the GGL, seated in Saxony-Anhalt, which is responsible for permitting and supervising all games of chance in Germany that are operated online. As of 1 January 2023, the GGL is responsible nationwide for the licensing and supervision of: • online poker; • virtual slot machine games; • horse betting on the internet; • sports betting; • nationwide social lotteries; • commercial gambling brokerage in several states; and • the class lotteries. Social Gaming German gambling regulation does not regulate social gaming, as social games are usually designed to fall outside the definition of a game of chance.
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