Munich court ruling dooms Germany’s lottery monopolies

A German court has declared state lottery monopolies to be unlawful, potentially opening the door for international operators while injecting further confusion into the country’s overall gambling market.

Last week, the Administrative Court of Munich issued a ruling that upheld a complaint brought by a Bavarian firm that had been blocked from obtaining permission to operate a lottery in the administrative district of Upper Palatinate.

As detailed by MBL-HSG attorney Martin Arendts, the unnamed operator got the runaround from the Bavarian Ministry of the Interior, which stated that the plaintiff wasn’t qualified to operate a lottery in the state, despite the plaintiff submitting several revised applications intended to satisfy the state’s increasingly opaque and shifting justifications.

The Munich court ultimately concluded that the state’s desire to retain its lottery monopoly ran contrary to Article 56 of the Treaty of the Functioning of the European Union (TFEU), which guards against the protectionist impulses of EU member states. The EU permits its members to maintain gambling monopolies that are designed to keep problem gambling under wraps, but only under certain circumstances.