888 Takes Germany’s Online Gambling Restrictions to Court

888 Takes Germany’s Online Gambling Restrictions to Court

The London-listed online gambling group, 888.com, has decided to fight gambling restrictions in Germany by challenging legislation in a court of law.

The group announced that one of its subsidiaries, which had been directly affected by the German state of Baden-Wurttemberg's decision to uphold an order prohibiting the provision of online gambling services, has decidedly to challenge the Federal Administrative Court (Bundesverwaltungsgrericht) ruling. The subsidiary will seek a ruling by the German Federal Constitutional Court .

Ruling Infringes Constitutional Rights

In a brief announcement, 888.com said the following: "After consulting with legal counsel, the Group's subsidiary has filed a constitutional complaint with the German Federal Constitutional Court in which it has asserted its position that the ruling of the German Federal Administrative Court infringes its constitutional rights, as well as its rights under EU law (including the freedom to provide services), and hence should be reversed." .

888 said that it would continue to closely monitor the legal and regulatory developments in Germany and their implications on the status and of its offerings in this market.

2017 Results Reflected German Concerns

In its 2017 full-year results published last month, 888 highlighted its concerns regarding the German gambling market, informing investors of a $45 million penalty charge that it was forced to pay over market activity in the country before 2015.

This penalty, combined with operating expenses, saw 888 report a profit of $18.8 million before tax last year, compared to $59.2 million before tax the year before.

888 referred to the Federal Administrative Court's upholding of the ban on three types of online gambling, namely poker, casino and scratch cards. The ruling saw the court reject an appeal made by two groups, one of which is a subsidiary of 888.

In its filing, 888 Holdings said that it was "highly disappointed by this far-reaching ruling," and at the time said that it was "considering potential courses of action, which may include a petition to the German Federal Constitutional Court." 888 also said that it was "assessing the status and breadth of its offerings in the German market."

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New Records Set for 888

Despite its struggle to gain a foothold in the German online gambling market, 888's 2017 full year report was a good one, with revenues reaching record heights of $541.8 million for the 12 months leading to December 31st.

The chief executive officer of 888, Itai Frieberger said that the group had delivered another year of progress and achieved record revenues.

"The group's growth was driven by further expansion in casino, sport and across regulated markets," said the CEO. "This very robust outcome was achieved despite the group's withdrawal from certain markets during the year and demonstrates 888's resilience and agility that is underpinned by first class technology and an outstanding team."

Frieberger said that the group had continued to reap the rewards of its investments in recent years in several growth markets, especially Italy and Spain. Looking ahead, 888 said that the company's current trading since the start of 2018 was in line with expectations, with average daily revenue 6% above the previous year, and representing an 8% increase when adjusted for the withdrawn markets.

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