By Rosalba O'Brien and Maria Sheahan
LONDON/FRANKFURT May 3 The first licences to
offer online gambling in Germany have been awarded, with British
online betting firm Betfair benefiting from the state
of Schleswig Holstein's liberalised gambling rules.
The northern state, whose centre-right coalition government
voted in favour of relaxing its gambling laws in September, said
on Thursday that it had awarded three licences valid to 2018 -
one to Betfair for sports betting, one to Germany's Jaxx AG
and one to the state lottery.
The other 15 German states have backed more restrictive laws
that have been criticised by betting companies, who say they
will favour state monopolies. The European Commission has also
raised questions over the planned restrictions.
Schleswig Holstein's laws demand a 20 percent tax on gross
profits rather than a more punitive tax on turnover, and also
allow for online casino-style gambling, which the other states
want to ban.
Analysts at BarCap estimated that the tax payment would
equate to about 3 million pounds ($4.9 million), or about 3
percent of core Betfair earnings.
"We view this as a significant positive for the company,
given that it further erodes the bear case on the stock that
Betfair would be unable to get licensed outside of the UK," the
Schleswig Holstein's interior ministry said it expected to
award licences for poker and other casino-style games in the
coming weeks, which Betfair has also applied for.
The largely illegal German sports betting market is
estimated to be worth at least 5 billion euros ($6.6 billion).
By 1140 GMT Betfair shares rose 6.5 percent to 846 pence,
while Frankfurt-listed Jaxx shares jumped 10 percent.
Shares in Bwin.party, which is also eyeing the
German betting market, rose 3 percent.