A triumph for Tipico: Limiting of sports betting licenses violates EU law

Monday, Apr 25, 2016 12:00

Sports betting company Tipico filed a lawsuit with the courts in Wiesbaden, Hesse in Germany. Tipico argued that the federal state law of Hesse, which limits licenses for sportsbooks to 20 providers violates EU law.

The federal state of Hesse is responsible for issuing licenses to German providers of sports betting and decided, following a selection process which took two years, on twenty providers who can provide sports betting. Among these providers are Oddsett, the state-run Sportwetten GmbH and Cashpoint.

Following this decision, the federal court in Wiesbaden received several complaints from providers, whose applications were denied. This week, the courts ruled in favour of Tipico and the lawsuit is expected to act as an example for those by other providers that are expected to follow suit.

The company, which was founded in 2004 and is based in Malta, is the official betting partner of the German Bundesliga team FC Bayern München. The license awarded by the courts in Wiesbaden is valid for seven years. In a statement, Tipico announced that it was delighted with the results, which also means that there will be no redundancies among the company’s 5000-strong workforce.

The decision is based on EU law, which argues that service providers have the right to transparency and equal treatment. The federal state of Hesse could not justify its decision to limit licenses for sports betting operators to twenty. Therefore, Tipico has to be granted a license by the federal state of Hesse.

The delay in regulating the market has resulted in losses of several million, argue experts such as Christoph Schmidt of Oddset. At last, the Tipico case provides many providers with a glimpse of what lies ahead in a soon-to-be regulated and fair market.