As more players in Germany shift to illegal sites without safeguards, the German Betting Trade Association (DSWV) calls for more action against black market activity. It was recently agreed that the regulators need to work more closely with operators and suppliers to take action against black market operators. While this discussion is still in its early stages, we can expect a proposal for a regulatory change to hit the market in the near future.

In February of 2023, the DSWV conducted a follow-up market analysis to their previous study and revealed a notable surge of at least 65% in illicit gambling and sports betting activities. A factor that is contributing to this, is the local market limitations that currently exist in Germany. The argument is that this causes players to seek out welcome bonuses, higher bet settings, tax-free gaming, and limitless deposits at unregulated black-market gambling sites.

During the last few years, we have seen many regulatory changes around the world to better reflect gambling in the digital age. For example, the UK’s Gambling Act White Paper is, in Germany, generally revered as a progressive measure for gambling regulation. The UK’s Gambling Act White Paper which was released in April 2023 aims to more accurately reflect gambling in the digital age, by addressing issues related to VIP customers, slot limits, and financial risk checks. Would a similar solution like this work in Germany, and what would be the implications of that?

How difficult is it for existing businesses to comply with new potential or more relaxed regulations in Germany to combat the black market? Usually, regulatory changes that aim to get players to play at licensed operators also increase online gambling activities. This comes with an increased risk of fraud, which itself is also evolving and finding new ways to trick operators. New types of fraud such as AI-assisted, Synthetic Identity Fraud, and Address Fraud, have, during 2023, become more common in the onboarding process. How much of a threat are these new types of fraud to operators from a German legal perspective?

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