DVTM agrees self-regulatory ad model for S-H licensees

7 July 2020

The German Association of Telecommunications and Media (DVTM) has finalised a new self-regulatory framework for advertising by Schleswig-Holstein licensed operators on the country’s free-to-air TV channels.

Agreed following negotiations between the DVTM, the state Ministry of the Interior and federal advertising association the Zentralband der deutschen Werbewirtschaft (ZAW), it limits the state’s online casino licensees to 17,000 minutes of air time per month.

This would ensure a proportional representation of online casino providers in TV advertising, the DVTM, which counts eight of the state’s 11 licensees among its members, explained.

The allocation of minutes to gambling advertising was determined using the Königstein key (Königsteiner Schlüssel), which is used to determine which resources go to each German state.

It is formulated based on tax revenue from a certain industry and population. In the case of gambling advertising, is designed to ensure the ads shown in Schleswig-Holstein (the only state in which online casino is currently legal) at least corresponds to or exceeds the number shown nationwide.

The DVTM noted that it monitors advertising by members using neutral media data sources, and regularly shares this information with Schleswig-Holstein authorities. It will take action should its members exceed the agreed 17,000 minute limit.

Dr Andreas Blaue of German sports media business Sport1 Medien, who negotiated the new agreement alongside DVTM president Renatus Zilles and leading German gambling lawyer Dr Wulf Hambach, said the self-regulatory model was “strictly logical”. Advertising by Schleswig-Holstein licensees could easily be checked using Nielsen Media Research data, he added.

“Absolute transparency and fairness are thus maintained for all parties, and it has already led to the advertising time for licensed online casinos from Schleswig-Holstein on national television having been significantly reduced since 2019,” he said. “[Furthermore, advertising] and has not increased during the [novel coronavirus (Covid-19) pandemic.”

Schleswig-Holstein licensees had previously been criticised by regulatory authorities such as the advertising watchdog in the state of Saarland, Landesmedienanstalt Saarland (LMS). In September last year its director Uwe Conradt claimed that the operators were flouting regulations by broadcasting advertising on nationwide channels, despite their products only being legal in one state.

In June this year LMS then prohibited two Schleswig-Holstein licensees from advertising in the state.

However DVTM president Renatus Zilles attacked claims that gambling advertising was on the rise, arguing that this was being driven by competing industries such as the land-based gaming machine sector. He admitted that it had “unfortunately” been accepted as fact by lawmakers, but argued that these claims only served to harm the online sector and consumers.

"Finding pragmatic, responsible solutions with one another instead of fighting against each other is the guiding principle of our association,” Zilles said. “This solution could serve as a model for regulating advertising under the future State Treaty on Gambling.”

Germany’s gambling market is in a state of flux, after the third amended State Treaty on Gambling, which would have opened up the market to sportsbook operators, was effectively derailed by legal challenges.

While this in theory should limit the market to online sports betting only, recent developments in Hesse suggest that some regulators may take a more tolerant stance. Court proceedings in a challenge to a prohibition order issued by that state’s Regional Council of Darmstadt, the authority responsible for licensing and enforcement under the third Treaty, were halted to allow the parties involved to negotiate a compromise.

This may set a precedent for allowing operators to offer online casino as well as betting, with the fourth State Treaty, the Glücksspielneuregulierungstaatsvertrag, to open up the market to all products and verticals.

In August last year a report estimated that gambling advertising spend in Germany rose to €401m for the year to 31 May, 2019, driven predominantly by online casino operators. These businesses had increased spending by €70m year-on-year, with state lotteries accounting for just 10% of total spend.