SWEEPSTAKES
“Gambling exists when, within the framework of a game, a fee is charged for the acquisition of a chance to win and the decision regarding the win depends entirely or predominantly on chance.” This definition gives rise to three elements that must be cumulatively present for an activity to be subject to German gambling regulations: (1) a consideration (payment); (2) the decision regarding the win depends entirely or predominantly on chance; and (3) the consideration is given in exchange for a chance to win a monetary prize. Social sweepstakes casinos can therefore be offered in Germany without a gambling license if one of the aforementioned elements is not met, and the offering would consequently not fall within the scope of the IST 2021. It should be noted, however, that when reviewing an offering, a comprehensive assessment of all elements is always conducted by the regulator, the Joint Gambling Authority of the German States (abbr. “GGL”). It is therefore risky to base the offer solely on a single missing characteristic of the definition of gambling. The element of consideration The existence of consideration is doubtful in the context of sweepstakes, as Sweep Coins cannot be purchased directly with real money. Nevertheless, at least an indirect acquisition through the purchase of Social Coins is possible, which is why a specific asset could be assumed in certain scenarios. It should be noted that German courts tend to set the threshold for the significance of the consideration low or reject such a threshold entirely. Although the legal issue has not yet been conclusively clarified by case law, an amount exceeding 50 cents is very likely to be classified as “significant” by regulatory authorities. 11 A threshold of 50 cents has been accepted in case law as the de minimis threshold, 12 although more recent decisions also take the temporal aspect into account and consider a fee to be significant if the player can lose approximately 10 euros per hour. 13 However, a significant line of administrative case law argues
imposed pursuant to this section must be collected by the unit and distributed to the Gambling Addiction Prevention and Treatment Fund established in Title 5, section 20006-B." 9 The most recent legislative response followed several cease- and-desist orders from state regulatory agencies and also extends to hearings on prohibition laws in other states, such as Florida and Tennessee. 10 Overall, it can be concluded that the U.S. has taken a clear direction: Sweepstakes casinos are no longer tolerated as harmless marketing games, but are increasingly viewed as de facto gambling that requires appropriate regulation and licensing or must be banned. The legal situation in Germany: Sweepstakes in light of the IST 2021 In contrast to the dynamic developments in the U.S., Germany has so far lacked specific legal regulations for sweepstakes offerings. However, this does not mean that this area is completely unaffected by existing regulations. Rather, it must be examined whether and to what extent sweepstakes platforms can be subsumed under the existing IST 2021. The IST 2021, which has been in effect since July 1, 2021, forms the legal framework for regulating gambling in Germany, including a licensing system for private operators of sports betting, virtual slot machines, online casino games, and poker. If an activity qualifies as the operation of online gambling and allows players in Germany to participate, it is either prohibited or subject to licensing. However, the provisions of the IST 2021 do not provide for licensing of online games other than those specified in the regulation. These can be broadly categorized into lotteries, sports and horse racing betting, virtual slot machines, and online casinos. Sweepstakes as such are not expressly covered therein. The crucial question is: Do sweepstakes meet the legal definition of gambling within the meaning of Section 3(1), Sentence 1 IST 2021? The legal definition of gambling is:
9 Ibid 10 Legislative roundup: Sweepstakes casino heat builds as bans advance in three states February 23, 2026 | By Pat Evans 11 Cf. Higher Administrative Court of Baden-Württemberg, judgment of May 23, 2013, file no. 6 S 88/13, para. 30 12 Hamacher in: IST 2021 § 3, Hamacher/Krings/Otto, Gambling Law, 1st edition 2022, para. 6 13 Dietlein in: IST 2021 § 3, Dietlein/Ruttig, Glücksspielrecht, 3rd edition 2022, para. 11 with further references
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IMGL MAGAZINE | JUNE 2026
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