The Higher Administrative Court of Rhineland-Palatinate in Koblenz has found that the German regulator die Glücksspielbehörde (GGL) had no legal basis to order a provider to block Malta-based online lottery business Lottoland.
Lottoland was subject to the first German blocking order issued by the new regulator, due to its view that lottery betting was prohibited under Germany’s Fourth State Treaty on Gambling.
In a statement outlining its decision, the regulator said that Lottoland had represented a particular danger since the nature of the product may cause consumers to confuse the illegal offering with a legitimate lottery.
Following the regulator’s decision to impose the blocking order, it commanded an IP provider to block Lottoland’s online sites. The telecommunications company objected to this and sought a legal solution.
While initially the Koblenz Administrative Court did not intervene, on appeal, the higher court amended the decision and issued a directive stating that the blocking order should be suspended.
The court said that the order was “clearly unlawful”. In its reasoning, it stated that under the definition provided by the Telemedia act, the business was not a responsible service provider and so could not be commanded via the authority invested in the GGL.
Additionally, under German law the service provider is not responsible for any third-party content broadcast on its services unless it transmitted it itself.
However, IP blocking is not the only tool open to the regulator. The GGL has, in the past, considered increased cooperation with the tax authorities or payment providers as other methods to reduce the activities of the illegal operators.
“The reporting of gambling providers to the responsible tax authorities is one of the most effective instruments for combating illegal gambling on the internet. Because, with tax debts, the probability of obtaining a permit in the future is almost zero,” said a GGL board member.
“If you have tax debts in Germany, you also risk being denied permits abroad. Licences that have already been granted can also be revoked.”