Schleswig Holstein Gaming Act_English version_Oct 2011_fnl

Schleswig-Holstein Gaming Act - 20 October 2011_ (Schl.-H.) II, Vol. Nr. 2186-15

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Act

Restructuring Gaming (Gaming Act)

20 October 2011

Statute Book of Schleswig-Holstein

(Schl.-H.) II, Vol. Nr. 2186-15

The Federal State Legislative Assembly has adopted

the following Act.

Summary of contents

Section I

General provisions 2

§ 1 Aims of the Act

§ 2 Scope of application

§3 Definitions

§4 Event permit 3

§5 Sales permit

Section II

Approval Procedures 4

Subsection 1. Lotteries

Regional lotteries, Class Lotteries

§6 Regional lotteries

§7 Class Lotteries

§8 Sales permit 5

§ 9 Brokering requirements

Charitable lotteries

§10 Permits for charitable Lotteries

§11 Hosting of Charitable Lotteries; Sale of Charitable

Lotteries

§12 Lottery Schedule, Costing and conducting of Event

§13 Use of net proceeds 6

§14 Form and Content of permit

Small Lotteries and prize-linked Savings

§15 Small Lotteries

§16 Prize-linked Savings

Subsection 2. Casinos - Land-based casinos

§17 Requirements for Casinos, player exclusions,

blacklists, data processing

Online Casinos (online-casino games) 7

§18 General requirements for Online Casinos

§19 License as Operator of online-Casinos

§20 Sales permit 8

Subsection 3. Betting

§21 General Requirements for Betting

§22 Permit for Betting Companies 9

§23 Sales permit

§24 Betting Regulation and Betting Books 10

Section III

Player Protection

§25 Information Obligations

§26 Advertising

§27 Protection of Minors, Player Protection and

Declarations 11

§ 28 Corporate Social Responsibility

Section IV

Gaming supervision, Approval control and Federal

State supervision

§29 Competent Approval and Supervisory Authority

§30 Supervisory powers

§31 Advisory Committee 12

§32 Fees

§33 Enforcement

Section V

Duties

Subsection 1. Duty aims

§34 Lottery duty

Subsection 2. Gaming Duty 13

§35 Taxation duty, Object of Taxation

§36 Duty Rate, Basis of Assessment

§37 Accrual of Duty 14

§38 Debtor duty

§ 39 Registration

§ 40 Duty recovery

§41 Duty aim 15

§42 Duty revenue

§43 Responsible Tax Authority

§44 Notification obligations

§45 Notifications to competent authorities

§46 Registration and filing Obligations

§47 Inspection

Section VI

Temporary and final provisions 16

§ 48 Temporary provisions

§ 49 entry into force, expiry


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Section I

General provisions

§ 1

Aims of the Act

The aim of the Act is to set up a regulatory framework

in relation to the offer (hosting, sale and brokering) of

any of the respective forms of public gaming, and more

specifically, ensure that :

1. gaming takes place in an orderly, fair,

responsible and transparent manner,

gamblers are protected from fraudulent

practices and its related consequences and

crimes are prosecuted,

2. citizens can pursue their natural inclination

towards gaming in an orderly and supervised

way, and in particular, ensure that unlawful

gaming is curbed and only appropriate forms

of lawful gaming are permitted in an

appropriate environment,

3. effective protection of young people and

gaming itself is achieved,

4. addiction to gaming is prevented and

measures are adopted to effectively combat

addiction and precautions taken against

exploitation through gaming,

5. the integrity of sporting competitions is not

harmed by the hosting and sale of sports bets.

§ 2

Scope of application

(1)By this Act, the State regulates the offer of public

gaming falling within the remit of this Act unless

otherwise decreed by current federal legislation.

(2)As far as Casinos are concerned, and to the extent

that they are land-based (Land-based Casinos), only §§

1-5, § 17, and §§ 25-27 apply. To the extent the

regulatory framework does not fall within the scope of

this Act, the prerequisites for the authorization and

establishment of the land-based casinos shall be

governed by the applicable state law. The procedure

and prerequisites for the grant of permits for casino

games with bankers [Black Jack, Roulette, and

Baccarat] comply with the Casino Act of the State of

Schleswig-Holstein.

§3

Definitions

(1) For the purposes of this Act, “gaming” is

understood as games, lotteries, and betting, in relation

to which payment of money is required in order to

have a chance of winning. Moreover, the chance of

winning totally or predominantly depends on fortune.

Casino games, in which the chance of winning depends

on fortune and the player’s skill, are also considered as

gaming. Bets requiring payment are also considered as

gaming for the purposes of paragraph (1).

(2) “Land-based gaming” is gaming hosted and offered

on fixed premises, especially at sales outlets, and are

offered and accepted there by virtue of the physical

presence of players. Online gaming is gaming, which is

hosted and offered without the physical presence of

players either on the Internet or through other means

of distance communication according to § 312 b para.

2 German Civil Code.

(3) A “lottery” is a form of gaming in which the

majority of people are offered the chance of winning

money in accordance with a specific plan and in return

for a specific payment. The provisions on lotteries also

apply, where items or other forms of material benefits

can be won as an alternative to money. A lottery is

considered to have a high frequency of events if the

time between the decision over a win or loss of a stake

and the following decision over a win or a loss of a

subsequent stake is less than one day, which therefore

gives the lottery a high incentive to play. The

provisions for lotteries also apply to tote betting.

(4) For the purposes of this Act, “betting” is considered

as accumulator bets or single bets on the outcome of

the progress of. Accordingly, an “event” is the result or

a future or current happening of a sporting

competition; lotteries and casino games are not

considered as betting for the purposes of this Act.

(5) “Casino games” include all the games traditionally

offered in land-based casinos, namely, poker, black

jack, baccarat and roulette.

(6) For the purposes of this Act, “payment” constitutes

a significant financial sacrifice, where it produces a loss

in the absence of a win, regardless of whether the

financial sacrifice is made as payment for the game in

question. By way of derogation from (1) in connection

with regional lotteries pursuant to §6(1), all financial

sacrifices are considered to be valid payment.


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(7) For the purposes of this Act, gaming is considered

to be “public” if a large, non-exclusive group of people

can participate or where gaming is hosted on a regular

basis by clubs or other private associations.

(8) An “operator” is anyone who sets up gaming at his

own expense. The hosting location will also be the

operator’s registered office. A person who hosts public

betting will be considered to be a betting company.

(9) Gaming is “sold” by anyone who responsibly offers

or creates the opportunity to conclude gaming

contracts, in particular by maintaining sales outlets or

through distance sales. Distance sales is understood as

sales achieved by the exclusive use of distance

communication pursuant to § 312 b (2) of the German

Civil Code. The point of sale is the place where the

player has the opportunity of participating. As regards

online-gaming, it is the place where the player has

established his residence or his habitual domicile.

Gaming sales may take place through operators

themselves (self-trading) or through third parties

(agents, retailers, and lottery collectors).

(10) An “agent” is anyone who, personally or through

third parties,

1. brokers individual game contracts on behalf of

operators, or

2. introduces potential players to gaming associations

and whose participation he brokers on behalf of

operators,

and provided it is done with the intention of making

sustainable profits from such activity.

(11) “Retailers” and “lottery collectors” are agents that

are integrated into the sales organization of operators

for the purposes of § 6 (2) or § 7 (1), below, who

exclusively broker game contracts for regional lotteries

or class lotteries on behalf of operators.

(12) The hosting, sale and brokering of gaming for the

purposes of this Act are considered as gaming “offers”.

§4

Event Permit

(1)The hosting of public gaming pursuant to this Act

requires a permit from the competent authority. A

permit to host betting on the outcome or progress of

sporting competitions requires the agreement of an

expert. Any hosting, brokering or sale of gaming that is

hosted without such a permit is forbidden.

(2) A permit shall be refused if the hosting of the

gaming is contrary to the aims of § 1 or where the

operator is unreliable.

(3) A permit is initially issued for a limited period of six

years. Subsequent permits are granted for periods of

four years respectively.

(4) The permit may be subsequently modified with

additional clauses to the extent necessary for the

proper implementation of the activities and aims set

forth in §1.

(5) The permit is issued in writing. It lists the permitted

forms of gaming. It cannot be transferred or assigned

to a third party.

(6) The permit may be withdrawn in the future if

circumstances become known that they would have

resulted in a refusal of the same, had they been known

at that time.

(7) The permit can also be revoked if the operator:

1. no longer fulfils the criteria for which the permit was

issued,

2. breaches any of the collateral clauses of the issued

permit,

3. fails to perform his legal obligations arising

thereunder, or

4. contravenes other provisions of this Act.

In the event of revocation of the permit by the

competent authority pursuant to § 1(1), the operator

is granted a period in which to comply again with its

terms. Moreover, in the event of minor infringements

of § 1(2)-(4), rather than revoke the permit, the

competent authority may issue the operator with a

warning. Further still, in such cases, the provisions of

§§ 116, 117 State Administrative Act apply.

(8) The Ministry for Interior may also enact decrees

1. issuing detailed requirements with respect to the

requisite credibility, potential and knowledge on the

subject of the intended gaming operations, as well as

with regard to the permit authorization and

supervisory procedures, especially concerning the

type, scope, purpose and form, respectively, of the

required documentation.

2. Rules relating to the processing of confidential

information and disclosure of confidential data

pursuant to this Act.

(9) Claims relating to the refund of expenses or

damages, which arise in connection with changes to

European legislation, are excluded.


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§5

Sales permit

(1) Sales from lotteries with high frequencies of events

pursuant to § 6 (1) 1, betting or online-casinos in

principle require permits from the competent

authority in accordance with the provisions of this Act.

The permit shall be refused if the sale of gaming is

contrary to the aims of §1 or where the applicant is

unreliable.

(2) If the hosting of public gaming is permitted under

this Act and sales do not require a permit according to

Paragraph 1, the competent authority must be notified

of the same. The federal state legislation may also

require notification of the sale in the federal state in

question, even if such notification requirement is not

required under Paragraph 1, above.

(3) For permits according to Paragraph 1, the

provisions of §4 (3)-(9) shall apply.

(4)The sale of public gaming is forbidden unless permit

and notification obligations have been fulfilled under

this Act.

Section II

Approval Procedures

Subsection 1

Lotteries

Regional lotteries, Class Lotteries

§6

Regional lotteries

(1) Regional lotteries are lotteries,

1. which have a high frequency of events (§ 3 Para.(3),

sub.3.) or

2. which game schedule foresees that the value of the

biggest win is greater than 1 million Euro, or

3. which game schedule foresees the creation of a

jackpot, so that,

a) when, a particular a prize category is drawn and the

winnings are not claimed, they can be added to the

following draw, or

b) where parts of the payments due from the player

can be accumulated for the purpose of achieving

wins at future draws so that a biggest win of over 1

million Euro can be achieved.

(2) the organization of regional lotteries is nonetheless

subject to the attainment of the federal state’s aims

pursuant to § 1, notably, the prevention of scams and

fraud. The federal state itself may also lawfully set up

regional lotteries through legal persons under public

law or through appointed private companies.

(3) Accordingly, the Federal State of Schleswig-Holstein

has exercised its public right under Paragraph 2, above,

through the establishment of the NordwestLotto

Schleswig-Holstein GmbH & Co. KG (hereinafter

NordwestLotto Schleswig-Holstein), the quotas in

which are totally or predominantly held directly or

indirectly by the Federal State.

(4) Upon agreement with the Ministry of Interior and

Ministry of Finance, the exercise of the right can be

totally or partly entrusted to legal persons under public

law or private companies. In such cases, the Federal

State and other Federal States can own significant

quotas directly or indirectly. Moreover, the

NordwestLotto Schleswig-Holstein can host number

lotteries and “scratch-and-win/ tear-and-win” lotteries

(Losbrieflotterien), as well as additional lotteries and

other game draws.

§7

Class Lotteries

(1) §6 para.(2), sub. 1 applies to class lotteries.

(2) Where the provisions of the State Treaty for State

Class Lotteries of 26 May 1992 (SCL State Treaty) or

the regulations for the North West German Class

Lottery from the State Treaty for the North West

German Class Lottery (NWGCL State Treaty) of 1

September 2008 conflict with the provisions of this

Act, then the provisions of this Act shall prevail.

(3) By way of derogation from Art. 4 of the SCL State

Treaty and from § 9 of the NWGCL State Treaty, an

operator permit under § 4 para.(1), above, has been

issued by the competent authority for the Class

Lottery.

(4) The Federal State may host class lotteries jointly

with other federal states, or through a public law

entity established together with the other federal

states or a private company, provided in the latter case

that the federal state in question or other contracting

federal states have a significant quota, regardless of

whether they hold their quotas directly or indirectly.


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§8

Sales permit

(1) An application for a permit can be made by the

operator for sales at sales outlets,

(2) Class lotteries sales are subject to notification

obligations; the consent of the operator also has to be

demonstrated. No claims can be made subsequent to

conclusion of a sales contract.

§ 9

Brokering requirements

The following requirements shall apply to sales from

high event number lotteries by agents (lottery agents):

1. The lottery agent must forward at least two-thirds of

any sums collected from players in order to participate

in a game to the operator. Immediately after the

brokering of a game order, it must inform players in a

clear and comprehensible manner of the amount

forwarded to the operator in order to participate in

the game as well as notify the operator of any such

players.

2. Lottery agents and any third parties commissioned

either by them or by interested players within the

meaning of § 3 para.(10), above, must disclose the

brokering of any participation in a game to the

operator.

3. Upon conclusion of the contract, lottery retailers

must ensure that a trustee qualified within a legal or

tax advisory profession or a trust company that

employs such professionals is commissioned with the

safekeeping or storage of ticket receipts and the

assertion of winning claims against the operator. Upon

conclusion of the contract, the game participant shall

be granted the right to view ticket receipts that were

brokered in their order.

Charitable Lotteries

§10

Permits for charitable Lotteries

(1)Lotteries that are capable of ensuring that any net

proceeds will be used mainly for charitable purposes

shall be approved upon application if the permit

requirements are met. The competent authority shall

be responsible.

(2)The permit shall be issued if the game schedule

foresees that,

1. the draw results are not announced more than twice

a week,

2. the maximum winnings do not exceed a value of

EUR 5 million, and

3. any payments made by players are not partly

accumulated for the purpose of creating winnings

for future draws (planned jackpot).

§11

Hosting Charitable Lotteries;

Sale of Charitable Lotteries

(1) An event permit may only be issued if the operator,

1. satisfies the conditions of § 5 para. (1), sub. 9 of the

German Corporation Tax Act, and

2. is reliable, in particular by providing a guarantee

that the event is implemented properly and can be

fully understood by both game participants and the

competent authority, and that any net proceeds are

used appropriately.

Paragraph (1), sub 1, above, does not apply to

operators for the purposes of § 6 para.(2) and § 7

para.(1), lotteries operated by the public body

“Bavarian Red Cross”, or to events taking the form of

prize-linked savings (§ 16).

(2)If the event is conducted either wholly or mainly by

a third party, then the permit may only be issued if

there is no risk that the transparency and

controllability of the event may be affected, and if the

third party

1. meets with the requirements of Paragraph 1 sub.(2)

and

2. is subject to instructions from the operator with

respect to conducting the event and does not have

any significant legal or actual influence over the

operator.

(3) the holder of an event permit according to § 10

shall be entitled to sell the lottery. The operator shall

not require a special permit according to § 5 para.(1).

The notification requirements for sales activities must

comply with § 5 para.(2).

§12

Lottery Schedule, Costing and conducting of Event

(1) According to the game schedule, the net proceeds,

winnings and costs must relate proportionally to each;

the cost of the event must be kept as low as possible.

The net proceeds are the amount resulting from the

sum of any payments received after deducting any

costs, winnings and taxes. Provision should be made in


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the game schedule for at least 30 per cent of payments

received to go towards the net proceeds and winnings

and on no account should this percentage not be

reached. When an application is submitted, a cost

estimate must be compiled that is based on the

expected costs of the event, winnings, taxes and net

proceeds. After issue of the permit, if it appears that

the estimated costs are likely to be exceeded, then this

must be notified to the competent authority

immediately and a new cost estimate has then to be

prepared.

(2) With respect to lottery costs, the nature and extent

of any third party costs may only be taken into account

within the meaning of § 11 para.(2) insofar as they

meet the principles of economical management. The

remuneration of third parties should not be calculated

on the basis of the amount revenue received.

(3) The operator must submit all documentation and

information required to the competent authority in

order to verify that the lottery has been conducted

correctly. It must also provide a statement based on

the actual amounts of revenue, net proceeds, winnings

payouts and event costs.

(4) In order to verify that the lottery has been properly

planned or conducted, especially regarding the

appropriateness of costs, the competent authority

may, at the expense of the operator, commission an

auditor to provide their expert opinion or request the

operator to commission one. The costs of the expert

opinion are considered lottery costs.

§13

Use of net proceeds

(1) Any net proceeds from the event must be used for

charitable or benevolent purposes as specified in the

permit in a timely manner.

(2) If the operator wishes to use the net proceeds for a

purpose other than the one specified in the permit, or

if the intended purpose cannot be achieved either at

all or in a timely manner, then the operator must

notify the competent authority immediately thereof.

Following consultation with the operator, the former

may stipulate a new charitable or benevolent intended

purpose.

§14

Form and Content of Permit

The permit shall be issued in writing. It should state

the following:

1. the operator as well as any third parties in the case

of § 11 para.(2),

2. type, location or area as well as the start date and

duration of the event,

3. the intended purpose for use of net proceeds, the

type and method of proving use and the time in which

such proof will be provided,

4. the game schedule and

5. the sales form.

Small Lotteries and prize-linked savings

§15

Small Lotteries

The competent authority may depart from the

regulations of this Act for lotteries, in the event that

1. the sum of payments to be received does not

exceed EUR 40,000,

2. the net proceeds are used exclusively and directly

for charitable or benevolent purposes, and

3. the net proceeds and winnings amount to at least 25

per cent of payments received.

§16

Prize-linked savings

By way of derogation from § 4 para.(1), prize-linked

savings lotteries operated by a credit institution within

the meaning of § 1 para.(1) of the German Banking Act

need only notify the competent authority if a partial

amount not exceeding 30 per cent contributed by a

participant is used as the lottery ticket share for the

prize-linked savings lottery, and the net proceeds

amount to at least 25 percent of lottery ticket shares

and are used for charitable or benevolent purposes.

Subsection 2

Casinos

Land-based casinos

§17

Requirements for Casinos, player exclusion, blacklists,

data processing

(1) Land-based casinos (fixed casino operations) must

maintain a comprehensive exclusion system in order to

protect players and combat gaming addiction.

(2) Land-based casinos shall exclude individuals who

ask to be excluded (self-exclusion). Alternatively,

individuals who, on the basis of staff observations or


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other factual evidence, are assumed to have a gaming

addiction or are insolvent, fail to meet their financial

obligations or risk stakes that are disproportionate to

their income or assets are also excluded (external

exclusion). In the event of the external exclusion being

challenged by the player, the competent authority

shall decide.

(3) The exclusion is valid for at least one year. Land-

based casinos immediately notify the player in

question in writing of the exclusion.

(4) Land-based casinos must record all data required

for an exclusion onto a blacklist. The data must contain

the following:

1. family name, first name, maiden name,

2. aliases, any false names used,

3. date of birth,

4. place of birth,

5. address,

6. photographs,

7. reason for exclusion,

8. duration of exclusion, and

9. the notifying casino.

A record can also be kept, even if all data cannot be

collected. Documents leading to the exclusion must

also be kept.

(5) The cancellation of any exclusion is only possible

after one year has elapsed, and in any case only upon

written request from the player. The land-based casino

operator that ordered the exclusion shall make a

decision on this. The player’s assurance that the

reasons for his exclusion have ceased must be credible.

(6) Excluded players may not take part in any games in

land-based casinos. The ban shall be enforced by

checking the player’s ID card or by using a similar

identity check and comparing with the blacklist.

(7) Any recorded data must be transmitted as required

to the various authorities authorized to monitor any

game bans Data transmission can also be carried out

via an automated retrieval process.

(8) Data transmission to public authorities, especially

law enforcement authorities and courts, is permitted

by law.

(9) Any information issued and access to electronic

systems must be recorded.

(10) The data must be deleted six years after the

termination of the exclusion. Deletion is also permitted

at the end of the sixth year.

(11) Unless otherwise specified by this Act, the

respective provisions for the protection of personal

data shall apply.

(12) By way of derogation from § 4 para.(3) sub.(1), the

first permit issued for a land-based casino shall be for a

minimum of eight years.

Online Casinos (online-casino games)

§18

General requirements for Online Casinos

(1) Online-casinos games can only be operated within

the terms of a permit issued according to § 19 and can

only be sold for the purposes permit issued according

to § 20. The type and method of playing games shall be

defined on a case-by-case basis in the permit issued by

the competent authority.

(2) Anyone authorized to sell online casino games

according to § 20 must ensure that the General Terms

and Conditions of Business appropriately accessible to

individual players prior to the start of the game,

making mention of any valid permits and the

competent issuing authority, respectively. If the

provider is not actually an operator, it must disclose

the operator to the player prior to the start of the

game and ensure the General Terms and Conditions of

Business are appropriately accessible.

(3) Anyone already holding a permit to operate a

casino in accordance with the Federal state Casino Act

is also allowed to be an operator for the sale of online-

casino games.

(4) The sale of online casino games by third parties

requires the consent of the operator.

(5) The terms of § 17 also apply.

§19

Permit for operators of online-Casinos

(1) Operators of online-casino games may be approved

upon request if,

1. they are EU nationals under European Union law or

are legal entities whose registered office, central

administration or principal place of business falls with

the remit of European Union law or of a Signatory

State to the Agreement on the European Economic

Area, and

2. have the necessary reliability, capability and

expertise for the intended gaming activity The legal

representatives of legal entities must also satisfy the


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various requirements regarding reliability and

expertise.

(2) The permit shall be refused if there is evidence to

suggest that

1. public safety and order will be jeopardized by the

intended gaming activity, or relations between the

Federal Republic of Germany and other federal states

will be affected,

2. by collaborating with third parties, there is a risk to

the overall transparency and the ability to monitor

sales or any other brokering activity will be

prejudiced, or

3. it cannot be ensured that the game will be

implemented properly and in a way that is fully

understood by both game participants and the

competent authority in accordance with the aims of §

1.

(3) When submitting an application, the applicant shall

also provide the proposed General Terms and

Conditions of Business. Any amendments must be

notified.

§20

Sales permit

(1) The sale of online-casino games requires a permit

from the competent authority.

(2) The sales permit will be issued if the applicant fulfils

the requisite reliability and expertise criteria to

conduct sales and there are no reasons for refusal

according to Paragraph 3, below.

(3) The sales permit shall be refused if there is

sufficient evidence to suggest that

1. public safety and order will be jeopardised by the

event or sale of the event,

2. by collaborating with third parties, the overall

transparency and the ability to monitor sales or any

other brokering activity will be prejudiced, or

3. it cannot be guaranteed that the event or sale of the

event will be implemented properly and can be fully


competent authority in accordance with the aims of

§1.

(4) Insofar as an sales permit has been issued

according to § 19, then the reasons for refusal in

relation to the event and the operator of online casino

games under Paragraph 3 sub.1 or sub.3, above, no

longer need to be verified.

(5) The sales permit shall in particular specify the

operator, as well as the type of casino games and the

sales channels.


also provide the proposed General Terms and

Conditions of Business. Any amendments thereto must

be notified. With respect to distance sales, the

respective sales channels and the location of the

distance sales office must be notified.

(7) The applicant under Paragraph 1, above, shall

provide insurance guarantees to protect federal state

claims and against claims for payouts and. The

applicant shall in principle provide the insurance

guarantee in the form of an absolute bank guarantee

from a major bank based in the European Union or in a

Signatory State to the Agreement on the European

Economic Area. The guarantee shall amount to EUR

1,000,000 for the sale of online casino games. It can be

adjusted by the competent authority to an amount

that corresponds to the expected average game

revenues over a period of two weeks up to a maximum

of EUR 5,000,000. The issue of the permit according to

Paragraph 1 is based on the assumption that the

insurance guarantee has been provided. If the

guarantee is not delivered notwithstanding reminders

for the same, or is inadequately guaranteed, then the

permit shall be refused.

Subsection 3

Betting

§21

General Requirements for Betting

(1) Public betting may only be operated by betting

companies permitted according to § 22. A permit is

issued by the competent authority. The type and

method of betting shall be governed individually in the

permit from the competent authority. Any form of

betting that violates moral sensitivity is banned.

(2) Public betting may only be conducted to the extent

allowed by the terms of the permit issued by the

competent authority according to § 23. Public bets

may be sold by the betting companies themselves or

by an agent.

(3) Anyone who participates in the operation of betting

events may neither bet themselves nor place a bet on

the outcome or the progress of this event, nor may

they place bets using others. Anyone who intentionally

or negligently infringes this prohibition is therefore


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acting unlawfully. The offence will be punished by a

fine of up to EUR 100,000.

(4) The hosting and sale of betting must be kept

separate from an organisational, legal, financial and

staffing perspective from the hosting or the

organisation of the betting event. The same applies for

the operation of establishments in which betting

events take place.

(5) Anyone who sells public bets (§ 23) must inform the

player of the relevant betting operator prior to the bet

being placed. Furthermore, the General Terms and

Conditions of Business of the bets offered for sale, as

well any existing permits and the competent authority

must be adequately made known to the player prior to

placing a bet.

(6) Anyone who hosts or sells bets must not grant

credit to betting clients. Bets may be paid for using

standard credit cards.

(7) The terms of §17 are applicable.

§22

Permit for Betting Companies

(1) Betting companies may be approved upon request

if:

1. they are EU nationals under European Union law or

are legal entities. In such case, the registered office,

central administration or principal place of business

must come within the scope of European Union law

or that of a Signatory State to the Agreement on the

European Economic Area, and

2. they have the necessary reliability, capability and

expertise for the intended betting activity. With

respect to legal entities, the legal representatives

must satisfy the criteria regarding reliability and

expertise.

(2) The permit shall be refused if there is sufficient

evidence to suggest that:


intended betting activity, or relations between the

Federal Republic of Germany and other federal states

will be prejudiced,

2. there is a risk that, by collaborating with third

parties, the overall transparency and the ability to

monitor sales will be prejudiced, or

3. it cannot be guaranteed that the betting activity will

be implemented properly and can be fully understood

by both game participants and the competent

authority in accordance with the aims of § 1.


also provide its current General Terms and Conditions

of Business. Any amendments must be notified.

§23

Sales permit

(1) The sale of public betting requires a permit from

the competent authority for both fixed as well as

distance sales. Provided the competent authority has

already issued a permit according to § 22, then a

permit for self sales may be issued to the betting

company upon request in accordance with this

provision. This provision does not apply for sales made

by third parties (agents).

(2) The sales permits are granted to applicants who:

1. are EU nationals under European Union law or are

legal entities. In such case, the registered office,

central administration or principal place of business

must come within the scope of European Union law

or that of a Signatory State to the Agreement on the

European Economic Area, and

2. have the necessary reliability and expertise to

conduct sales; as proof of expertise, the terms of §3

para.(1) of the rules implementing the Act on Horse

Betting and Lotteries shall apply accordingly, as

amended on 21 august 2002, and

3. provided there are no grounds for refusal under

para.(3), below.

(3)The sales permit shall be refused if there is sufficient

evidence to suggest that:


event or sale of the event,

2. by collaborating with third parties, the overall

transparency and the ability to monitor sales will be

prejudiced, or

3. it cannot be guaranteed that the event or sale of the

event will be implemented properly and can be fully


competent authority in accordance with the objectives

of § 1.

(4) Provided there is an event permit according to § 22,

then the grounds for a refusal according to Paragraph

3, sub. 1 or sub. 3 in relation to the event and the

betting company no longer need to be verified. § 22

para.(4) applies accordingly.

(5) A sales permit shall specific the authorized to sell

bets, the type of bets and the sales channels. With

respect to fixed sales, the municipalities shall decide in


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accordance with town planning regulations on any

restrictions concerning locations for the purposes of

achieving the aims under § 1.


also provide its current General Terms and Conditions

of Business. Any amendments must be notified.

Furthermore, it must notify the number and location of

sites for fixed sales, as well as the respective sales

channels and the location of the distance sales office

for distance sales.

(7) The applicant shall provide an insurance guarantees

to protect federal state claims and against claims for

payouts in the form of an absolute bank guarantee

from a major bank based in the European Union or in a

Signatory State to the Agreement on the European

Economic Area. For fixed sales, the guarantee

1. in each location

a) in which betting is either exclusively or mainly

sold, or

b) which has more than two betting classes or

betting terminals, shall amount to EUR 20,000

2. in every other location it shall amount to EUR

10,000.

This insurance guarantee can be adjusted by the

competent authority to an amount equivalent to the

expected average betting revenues over a period of

two weeks. The guarantee shall amount to EUR

1,000,000 for distance sales. It can be adjusted by the

competent authority to an amount equivalent to the

expected average betting revenues over a period of

two weeks up to a maximum of EUR 5,000,000. The

issue of the permit under Paragraph (1) is based on the

assumption that the guarantee has been provided. If

the guarantee is not provided despite reminders to do

so or is not adequately guaranteed, then the permit

shall be refused.

§24

Betting Regulations and Betting Books

(1) In order to ensure equal treatment of betting

customers, the hosting and sale of betting may only be

done in accordance with betting regulations that are

binding for all betting contracts from operators or

holders of sales permits. This is to be submitted with

the permit application. The betting regulations must

contain provisions on the conclusion of betting

contracts and payouts.

(2) Each betting company and each holder of a sales

permit for betting must keep an electronic betting

book in which all betting transactions are recorded in

consecutive order without any time delays. The

electronic betting book, as well as any computer

software, data processing procedures and equipment

used for hosting or brokering bets, must be specifically

protected against unauthorised interference from third

parties. All betting transactions must be recorded in

the betting book for a period of four years.

Section III

Player Protection

§25

Information Obligations

(1) The holder of a permit must ensure the following

information is made available to players:

1. all costs resulting from participation,

2. the amount of all winnings,

3. when and where any winnings are published,

4. the percentage of payouts for winnings from stakes,

5. information on the probability of winning or losing

as well as the average payouts for the different forms

of the gaming,

6. the cut-off time for participation,

7. the method for determining the winner,

8. how the winnings are distributed between multiple

winners,

9. the limitation period within which winners may

claim their winnings,

10. the name of the permit holder as well as their

contact details (address, e-mail, telephone),

11. the commercial registration number (if available),

12. how the player can make a complaint, and

13. the date the permit was issued by the competent

authority.

Both players as well as authorities must have easy

access to this information.

(2) The competent authority may grant exceptions to

these obligations if the nature of the game or other

circumstances make it unreasonably difficult to satisfy

the various conditions.

§26

Advertising

(1) The type and extent of advertising of public gaming

must be appropriate and must not be in conflict with


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the aims of § 1. The advertising must not be

misleading, nor lead to inaccurate perceptions about

the prospects of winning. Moreover, the advertising

must not be aimed at minors.

(2) The competent authority may also lay down further

criteria in the additional clauses of the permit for the

hosting and sales in relation to the composition of

permitted advertising for lotteries with a high

frequency of events, betting and casino games.

(3) The advertising of illegal gaming is not permitted.

(4) The Ministry of Interior is authorized to issue more

detailed regulations on the subject.

§27

Protection of Minors,

Player Protection and Declarations

(1) Minors are forbidden from participating in public

gaming.

(2) The providers of public gaming are responsible for

ensuring that players play responsibly. They must

inform the public on the probability of winning and

losing, the possible risks of addiction with respect to

the type of gaming offered, the opportunities for

counselling and therapy as well as the prohibition on

the participation of minors.

§ 28

Corporate Social Responsibility

(1) The providers of public gaming are responsible for

ensuring that players are discouraged from playing

pathological games and any gaming addiction is

prevented. To this end, they must develop the

appropriate social responsibility policies for relative

gaming games laying down measures for the

prevention of pathological player behaviour.

(2)The providers of public gaming shall

1. appoint representatives to develop social

responsibility,

2. train staff that employed in the hosting and sale of

public gaming on early detection of problematic

player behaviour,

3. in the context of prevention, provide easily

accessible and easily understandable information

a) on the relative risks of the games in question;

b) on assistance measures, such as player exclusions,

addresses of counsellors and self-therapy groups for

both addicted male and female players;

c) through self-help handouts,

4. allow players to assess their own risk,

5. set up a telephone counselling service that is jointly

operated by several providers,

6. report to the competent authority every two years

on the success of any measures implemented for

player protection.

(3) Every two years, in connection with the

development of assistance measures, the competent

authority shall draw up a report on the measures taken

by providers, the safety of gaming and player

protection activities.

Section IV

Gaming supervision, Permit control and Federal State

supervision

§29

Competent Approval and

Supervisory Authority

The competent Approval and Supervisory Authority for

the tasks designated under this Act shall be the

Ministry on Interior. The Ministry may appoint another

authority by enacting a regulation to this effect.

§30

Supervisory powers

(1) The competent supervisory authority shall monitor

compliance with the provisions of this Act, as well as

observance of the rules specified in the permits and

related additional clauses. Accordingly, in individual

cases it may issue orders, as appropriate. In particular,

it may:

1. prohibit the hosting and sale of illegal gaming as well

as any related advertising,

2. request information or evidence from event or sales

permit holders that are subject to its supervision in

order to fulfil its duties;

3. take decisions on any objections to external

exclusions,

4. following the prior notification of illegal gaming

offers, prohibit credit and financial services

institutions from being involved in payments for

illegal gaming and payouts from illegal gaming in a

responsible manner.

(2) Challenges to, and complaints against, orders

according to Paragraph (1), above, do not have

suspensive effect.


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(3) The supervisory authority is responsible for the

issuance and revocation or withdrawal of permits as

well as receiving notifications according to § 5 para.(2),

unless stated otherwise herein.

(4) The supervisory authority shall work together with

the responsible authorities for gaming supervision

both domestically and abroad in the performance of its

responsibilities.

§31

Advisory Committee

(1) An Advisory Committee will be set up within the

Approval and Supervisory Authority. It shall advise the

approval and supervisory authority on the

performance of their duties, especially in terms of the

legal and technical aspects of the gaming sector,

addiction prevention, crime prevention and youth and

consumer protection, as well as in relation to the

integrity of sporting competition. It may also issue

recommendations on the general development of

supervisory practices to the management of the

approval and supervisory authority.

(2) The members of the Advisory Committee shall be

appointed by the President of the Approval and

Supervisory Authority, after consultation with the

interested parties. Sports organizations are

represented and have the right to vote on the Advisory

Committee. Science and research, consumer

protection groups, addiction experts, and gaming

providers must all be adequately represented within

the Advisory Board.

(3) The Advisory Committee shall elect a chairman

from among its members. The Advisory Board shall

also adopt its Rules of Procedure.

§32

Fees

(1) For the purposes of this Act, the Approval and

Supervisory authority shall charge the following fees

for the various tasks assigned to them:

1. a fee for handling the application and issue of a

permit for the gaming operator according to § 4 or a

permit for the sale of gaming according to § 5

(handling fee),

2. an annual fee for expenditure related to supervision,

especially for the enforcement of powers according

to § 30 para.(1) (supervisory fee).

(2) The Ministry of Interior shall determine the amount

of the fees by regulation from which chargeable

services, fees by way of fixed rates or framework rates,

as well as regulations for increases, reductions, scaling

and exemptions can arise. The rates shall be measured

in such a way that so that there is an appropriate

balance between the amount taken into account for

administrative expenditure and the importance of the

economic value or other benefits arising from the

actions of the approvals and supervisory authority.

Moreover, the provisions of the Administrative Costs

Act shall apply.

§33

Enforcement

The supervisory authority may enforce any orders that

it has made under its statutory powers by way of

coercive measures according to the provisions of

administrative law, in particular pursuant to §§ 228 et

seq., and 242 of the Federal State Administrative Act.

In addition, it can threaten coercive measures in each

case of non-compliancy. The penalty of up to EUR

250,000 may be imposed. The provisions of the

Federal State Administrative Enforcement Act shall

apply.

Section V

Duties

Subsection 1

Duty aims

§34

Lottery duty

(1) By way of derogation from §35, the NordwestLotto

Schleswig-Holstein is liable to pay duty to its federal

state. Accordingly, the Ministry of Finance, together

with the Ministry of Interior, shall issue Ordinances to

determine the duty rate aims taking account of lottery

laws, business and taxation interests, as well as the

maturity date and procedures for the payment of

duties. The Ordinance may also stipulate that duty for

the NordwestLotto Schleswig-Holstein has to be fully

or partly paid over to a third party in accordance with

the duty revenue aims.

(2) The duty from the Lottery, “BINGO – Die

Umweltlotterie” (BINGO) is to be used for the purpose

of nature conservation and protection of the


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environment, as well as for development projects

defined by Agenda 21. The Federal Committee for free

Welfare Services, the German Olympic Sports

Federation and the German Heritage Foundation

receive a part of the duties from the “GlücksSpirale”

Lottery, the rate of which is stipulated in Paragraph 2,

sub. 1 of the Ordinance.

(3) After deducting the amounts referred to in

Paragraph (2), above, firstly, 8 per cent of the

remaining amount, i.e. at least 6,3 million EUR are to

be used for the promotion of sports and, secondly, 4.9

per cent for the purposes of player insolvency

counselling.

(4) The remainder is then to be used to finance

scientific research into the prevention and combating

gaming addictions. The remainder is also to be used for

the setting up and furthering of information centres

for the prevention of and combating addiction.

Research programmes can be promoted together with

other federal states. Training in counselling is to be

taught on the basis of the research findings.

(5) The remainder is then to be used for charitable

purposes in accordance with the Fiscal Code.

(6) From the amount set aside in accordance with the

first option in Paragraph (3), above, 90 per cent is to be

used for the Schleswig-Holstein State Sport Federation

e.V. (registered association) in the promotion of sport.

A further 8 per cent of the amount is to be used for the

general promotion out-of-school sports activities,

while the residual 2 per cent is to be made available

for extracurricular school sports.

(7) The aim of promoting sport is to,

1. guarantee the work of sports teams and sporting

associations and put them in a position to offer a

wide variety of representative sports throughout the

federal state, and

2. guarantee the availability of activities and projects

for schools in collaboration with sports teams and

sporting associations, as well as extracurricular sports

activities.

(8) The donation to the Schleswig-Holstein State Sport

Federation e.V. is made available in particular for the

work of federal state sporting associations, their

facilities, sports teams, sporting circles and

professional sporting associations for both competitive

and recreational sports. Sports teams that have their

registered offices in Schleswig-Holstein but are actually

members of the Hamburg Sports Association may also

benefit from its application.

Subsection 2

Gaming Duty

§35

Duty liability, Duty aims

(1) For the purposes of this Act, a gaming duty shall be

levied on individuals that sell gaming.

(2) For the purposes of this Act, gaming sales are made

by permit holders authorized under this Act, and who

have their residence or place of habitual residence in

the Federal Republic of Germany. Moreover, the

games must be conducted in accordance with the

regulations. A sale is also deemed to have taken place

for present purposes, when gaming - normally

requiring a permit – is conducted in accordance with

the law but without the requisite permit.

(3) On the contrary, a gaming duty shall not be levied

on:

1. lotteries and betting that are subject to taxation

under the Betting and Lotteries Act,

2. land-based gaming subject to casino duty,

3. game equipment and other gaming opportunities

within the meaning of §§ 33c and 33d of the Trade

and Industry Act that are subject to VAT;

4. online-gaming, provided such is subject to VAT.

(4)§ 40 of the Fiscal Code shall apply accordingly.

§36

Duty rate, Basis of Assessment

(1) The duty rate is 20 per cent of the basis of

assessment.

(2) The basis of assessment is the gross profit from

gaming that has been offered and played. The amount

by which the total of all stakes exceeds the total of all

winnings paid out shall be deemed to be gross profit.

By way of derogation from therefrom, for gaming in

which the operator does not assume any risk (games

without a banker), the amounts accruing to the gaming

provider from the game are taken as the basis of

assessment.

(3) To the extent municipalities can levy an

entertainment tax under applicable federal state

legislation, then this must be deducted from the basis

of assessment.


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(4) §§ 90 and 162 of the Fiscal Code shall apply

accordingly. If the basis of assessment according to

Paragraphs (2) and (3), above, cannot be reliably

determined even in the form of estimates, then the

respective stake shall be deemed to be the basis of

assessment.

§37

Accrual of duty

(1) The duty shall accrue upon completion of the game

contract. If the gaming provider either wholly or

partially collects the stake prior to the completion of

the game contract, then the duty shall accrue upon

collection by way of derogation from para.(1).

(2) If a game contract is withdrawn and the stake is

either wholly or partially refunded, then the duty shall

also be revoked to the same extent.

§38

Duty debtor

(1)The gaming provider is considered to be the duty

debtor. Anyone who offers gaming without the

necessary permits is also liable to pay duties.

(2)Anyone who collects payment for gaming in

connection with the performance of a game contract

shall be liable to pay duty without being a duty

debtor. Duty debtors and parties liable to pay duty are

jointly and severally liable.

§ 39

Registration

(1)Gaming providers must register with the responsible

tax authority in order to fulfil their duty obligations.

Registration must take place prior to the start of the

gaming activity.

(2) For the purposes of registration, information shall

be provided on the following items by the gaming

provider:

1.name of gaming provider,

2.the place of residence of individuals, or for legal

entities the registered office of the gaming provider,

both with full signature,

3.the names of all legal representatives and registered

office of the management for legal entities with full

signature,

4.details on the types of gaming to be offered,

5.details on whether land-based gaming, online-

gaming, or both are to be offered,

6.details on the technical equipment provided for the

calculation of stakes and pay out of winnings, and

7.details on any other registration with the tax

authorities of other federal states and other Member

States of the European Union or the European

Economic Area.

(3)A further condition for registration, in addition to

the comprehensive and accurate provision of

information under Paragraph (2), above, is that the

technical equipment according to Paragraph (2), sub.6,

above, must satisfy the requirements for duty recovery

according to § 40.

(4) Any changes to data that are relevant for

registration and duty recovery must be notified

immediately to the responsible tax authority.

§ 40

Duty recovery

(1) The gaming provider must determine the total

amount of stakes and the basis of assessment

according to § 36 of all gaming conducted separately

on a monthly basis by gaming type, and moreover,

must submit the allocated gaming duty using an

officially prescribed dataset to the responsible tax

authority in accordance with prior duty data

transmission regulations and pay the duty (advance

payment). The transmission of data and the payment

of the corresponding duty must be made no later than

the tenth day of the following month in question.

(2) The gaming provider must submit an annual

declaration for the calendar year on an official

prescribed form to the responsible tax authority no

later than 31 May of the following year. This must

include the total amount of stakes and the basis of

assessment according to § 36 of all gaming conducted

separately by gaming type, the corresponding gaming

duty levied as a result for the calendar year as well as

any advance payments made according to Paragraph

(1). Any outstanding tax payable or possible credits

from the annual declaration shall be determined and

notified officially by the responsible tax authority.

(3) For tax purposes, foreign currency values must be

converted for the calculation of duty according to

applicable VAT provisions.


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§41

Duty aim

Duty is levied for the purpose of achieving the aims set

forth in § 1. In particular, through the interaction of

the various provisions regarding permit procedures

and player protection, the gaming demand of the

general population should be guided towards lawful

and supervised gaming offerings, and stem the

excessive expansion of gaming offerings by noticeably

reducing the profit incentives to providers.

§42

Duty revenue

(1) All and any duty revenue shall accrue to the Federal

State.

(2) It must guarantee that a significant proportion of

the duty revenue serves the purpose of financing the

aim set forth in § 1, as well as objective of promoting

public and favourable tax regime within the meaning

of the Fiscal Code in accordance with federal state law.

By way of derogation from Paragraph (1), above, up to

one third of duty revenue from sports betting shall

accrue to the Sports Association of Schleswig-Holstein

for the purpose of promoting the integrity of

charitable sport. Moreover, it must also guarantee that

5 percent of the revenue from online-gaming offers is

used for the purpose of financing gaming addictions

and debt and insolvency counselling.

§43

Responsible Tax Authority

The responsible tax authority for registration under §

39 and duty recovery procedures under § 45 is the

Kiel-Nord tax office.

§44

Notification obligations

(1) The competent approval and supervisory authority

must notify the responsible tax authority of the

content (including additional clauses and

supplementary orders), modification, revocation or

withdrawal of permits as well as of the results of their

monitoring activities regarding duty recovery.

(2) Authorities that wish to obtain further information

on unauthorised gaming must also notify the

responsible tax authority thereof.

(3) The content and scope of notification requirements

are determined by an ordinance of the Ministry of

Interior.

§45

Notifications to the competent authority

(1) If the responsible tax authority investigates a party

on suspicion of a having committed a tax offence or tax

irregularities with respect to the gaming duty, then it

must notify the competent authority thereof and

inform them of the outcome of proceedings.

(2) If the responsible tax authority obtains further

information on unauthorised gaming or their

brokering, it shall also notify the competent authority

of the same.

§46

Filing and record-keeping obligations

(1) Gaming providers must keep records of all gaming

conducted within the scope of this Act which must be

independent of any accounting and recording

requirements based on other laws; the information

required for levying gaming duty can then be consulted

in the said records. In particular, as regards online-

gaming, it must ensure the origins of players can be

reliably identified and the principles for the duty

recovery for gaming in which individuals participate -

whose residence or habitual domicile falls under the

scope of this Act - can be recorded. In this respect, the

provisions on money-laundering should be borne in

mind.

(2) §§ 145 to 147 of the Fiscal Code shall apply

accordingly for the general requirements for the filing

and the storage of documents.

(3) The special requirements and technical conditions

for compulsory records, particularly those relating to

electronic records for online-gaming, shall be

determined in an ordinance by the Ministry of Interior.

§47

Inspection

(1) In order to ensure a uniform assessment and

recovery of gaming duty, the entrusted officials of the

responsible financial authority may have access to the

sites and premises of duty debtors pursuant to § 38

during business and working hours without prior

notice and not in connection with an external audit.

Such access is intended to determine any issues that

may be significant for duty recovery (inspection). Living

areas may only be entered against the will of the

owner to prevent any urgent threat to public safety

and order.


16/16

(2) Provided such access is useful for duty recovery,

the parties concerned by the inspection shall produce

any records, books, commercial documents and other

documents related to the issues under inspection to

the entrusted officials, as well as provide information.

(3) If the findings of the inspection so require, an

external audit may then be required under § 193 of the

Fiscal Code without any prior audit arrangement (§ 196

Fiscal Code). The transition to the external audit shall

be notified in writing.

(4) If circumstances arise during the inspection that

may be relevant for the assessment and recovery of

other duties and taxes, then an assessment of the

findings shall be made, to the extent that knowledge

thereof may be of relevance to the taxation of parties

named in Paragraph (1) or other parties.

(5) The tax authority shall be empowered on the basis

of Directive 2010/24/EU, 16 March 2010, to appeal to

the responsible authorities of Member States of the

European Union for administrative assistance in the

recovery of claims relating to the gaming duty and any

related ancillary services.

Section VI

Temporary and final provisions

§ 48

Temporary provisions

Permits under this Act shall take effect from 1 March

2012. Gaming duty under this Act will be levied from 1

March 2012. Until 29 February 2012, the provisions of

the State Treaty on Gaming in Germany (GlüStV AG) of

13 December 2007 (GVOBl. Schl.-H S. 524) shall apply,

unless they are contrary to this Act. Claims and

legitimate expectations cannot be established until 29

February 2012.

§ 49

Entry into force, termination

This Act will enter into force on 1 January 2012. The

State Treaty on Gaming in Germany (GlüStV AG) of 13

December 2007 (GVOBl. Schl.-H. S. 524)*) will

terminate on 1 March 2012.

This Act is hereby executed and is to be published.

Kiel, 20 October 2011

Peter Harry Carstensen

Governor

*

Klaus Schlie Rainer Wiegard

Interior minister Finance

Minister

______________

* GS Schl.-H. II, Gl.Nr. 2186-13 (GVOBl. Schl.-H. =

Schleswig-Holstein Gazzette of Laws and Ordinances)

Entertainment & Humor

Schleswig Holstein Gaming Act_English version_Oct 2011_fnl