GGL reports black market generated between €400m and €600m in 2023

German regulator Gemeinsame Glücksspielbehörde der Länder (GGL) published its 2023 activity report which showed the black market generated around €400m to €600m, as CEO Ronald Benter said its approach to tackling illegal gambling was working.

The regulator said it checked 1,864 websites and processed a total of 438 cases of illegal gambling or advertising for illegal gambling, further broken down to 205 organisations across 761 German-speaking sites.

According to the GGL, the black market generated around €400m to €600m across the year, around 3% to 4% of the total market, which led to the regulator “to investigate the black market and the channelling of gambling on the internet based on a survey of gamblers”.

Legal proceedings were initiated in 133 cases and led to 63 providers stopping their services as a result of prohibition orders.

In 104 cases, the GGL filed criminal charges and said several offers have been halted due to “letters of advice” sent.

Due to legal developments, the regulator stated that IP blocks were not used but payment blocking was a “particularly effective enforcement tool” which saw payment transactions via well-known service providers no longer possible by the end of the year.

Benter noted the regulator’s approach was “having an impact” but challenges remained due to the illegal market operating internationally.

Alongside the 142 legal operators, the GGL said it approved 39 applications for “basic permission to organise and broker cross-border games of chance in 2023”.

Bento added those firms that do not meet the rules and requirements will face punishment including the potential withdraw of licences.

Bento said: “The aim of the GlüStV 2021 of transferring the formerly illegal market to the legal market has thus been largely implemented.

“The majority of the formerly illegal gambling providers are now under the supervision of the GGL and must adhere to strict requirements.

“Anyone who does not comply with these rules must expect regulatory consequences, including revocation of the licence,” he added.

Germany’s gross gaming revenue (GGR) increased by 2% year on year from €13.4bn in 2022 to €13.7bn in 2023.

Of that figure, €3bn was generated by online gaming and sports betting, accounting for the largest market share at €1.8bn – up from €400m in 2022.

Virtual slots and online gambling’s second year of licensing generated €400m, 3% of the market’s overall GGR.

With the ongoing Euro 2024 being held in Germany, the GGL said it began monitoring the sports betting market last year to prepare for the event’s betting activity.

Likewise, with the upcoming Olympics in Paris, the GGL said it “expects a slightly increased wall in the area of supervision”.

It added: “Overall, the GGL assumes it can continue on the path it has chosen and that its approaches will continue to successfully contribute to the implementation of the objectives of the [2021 State Treaty on Gambling].”

Regarding H2 2024, the GGL said it will focus on further evaluation of the State Treaty, with Bento noting a need for an adjustment in the application process for virtual slot machine games.

He explained: “We are constantly looking into ways to optimise administrative processes. One way to speed up the application process could be to directly involve the game manufacturers, the development studios, in the application process for the approval of individual games.

“That would speed up the process considerably.”