As a nation, Germany has a reputation for efficiency but this reputation is being sorely tested by the country’s attempts to regulate internet gambling. The process had already been complicated by Schleswig-Holstein’s attempt to go it alone and issue its own e-gaming licences but the recent plea by the state of Hesse for legal help in dealing with all the lawsuits it is facing from unhappy applicants is a new low in the story.

At a federal level Germany is planning to permit sports betting online but will not be permitting internet casino and poker. Last summer the state of Hesse’s Ministry of the Interior was given the responsibility of handling the licensing process. But from the start the process was not handled well.
The beginning of the licensing process was kept very quiet and a very short initial deadline was set. Inevitably, the first deadline had to be extended into January 2013 because some 150 companies wished to be considered for the 20 available sports betting licences. 

On a legal point, many companies submitted applications without any information being published on the formal application process. Such a document is required by EU law and could nullify the entire process.
In April 2013 around 18 companies, a mix of private and state operators, were put on a shortlist to go through to the phase 3 and have meetings with the regulator to determine their suitability for a licence. The intention was to issue licences by May 2013 and have the new sports betting firms operational in Germany before the end of the year.
But the increasing number of legal disputes could see any licences now delayed until 2014. 
One key ruling from the Administrative Court ruled in favour of applicant Bet Victor that Hesse’s Ministry of Interior had not had a clearly defined licensing procedure in place. Bet Victor was awarded a licence in Schleswig-Holstein but has seemingly not been included in the third phase for a federal licence. 
GBGC’s Director Lorien Pilling commented, “Ever since May 2012 when Schleswig-Holstein issued its first internet gambling licences and then had a change of government just a few days later, the e-gaming situation has got ever more complicated. With only 20 federal betting licences available it was inevitable that applicants that missed out would be far from happy, especially if they had already been approved in Schleswig-Holstein.” 
Global Betting and Gaming Consultants estimates that a fully functioning federal internet sports betting market in Germany could be worth EUR 425 million, given the 5% turnover betting tax and operational obstacles being proposed. But exactly when the German market will become “fully functioning” is difficult to predict.