After the breakdown of negotiations between the conservative People's Party (ÖVP) and the right-wing populist Freedom Party (FPÖ), Austria has formed a new three-party coalition government. This coalition has opted not to open up the market but to focus on continuing the current monopoly model - at least for now.
In the new coalition agreement between the center-right People's Party (ÖVP), the Social Democratic Party (SPÖ), and the liberal NEOS, the three parties have expressed plans to maintain Austria's current licensing status. The agreement was approved by the three parties on March 2.
After months of political turmoil, the coalition was established in February. The parliamentary elections in September failed to form a majority government. Subsequently, months of negotiations took place among the parties, some of which quickly broke down.
However, the Austrian Association for Betting and Gambling (OVWG) believes that the wording of the agreement—pointing to the "further development" of the current monopoly—still may leave room for future reforms.
Simon Priglinger-Simader, Vice President of OVWG, stated: "From our discussions with policymakers, we learned that online gambling licenses had not been negotiated when the government was formed."
"Many key decision-makers in the new government advocate for modernizing the online gambling market according to European standards. Clearly, the issues of reforming the monopoly system and opening the online gambling market remain unresolved."
The government will continue to implement a single license model
The only online casino license (currently held by Austrian Lotteries) will expire in 2027, and according to the government's coalition agreement, only one new online casino operating license will be granted, valid for 15 years.
The parties also plan to implement stricter measures against the increasing number of unlicensed operators in the country.
The coalition agreement states that the future government will decisively combat illegal gambling through measures such as "network blocking and payment blocking."
Currently, the only online licensed operator in Austria operates the online gambling brand Win2Day, whose platform is operated by Austrian Lotteries and Casinos Austria, the latter also being the monopoly operator of physical casinos in Austria.
As early as 2012, Austrian Lotteries won the first monopoly license through a controversial tender process held by the Austrian Ministry of Finance.
At that time, industry stakeholders criticized the view that the multi-year experience required for various verticals such as online casinos, lotteries, and slot machines could only be met by a single operator.
Since the department also holds a 33.3% stake in Casinos Austria and Austrian Lotteries and is responsible for collecting gambling taxes and issuing licenses, there were also accusations of conflicts of interest.
Stakeholders in the gambling industry in other European markets also hold this view, where monopoly models still prevail, especially in Nordic countries.
A new Gambling Authority will be established
To avoid encountering difficulties this time, the new Austrian coalition plans to establish an independent Gambling Authority within this legislative period.
This could take over the responsibilities of the Ministry of Finance during the next tender process for online and land-based casino licenses.
Although no final deadline has been set for the establishment of the new independent agency, industry experts say that the timeline is very tight, as several licenses will expire in 2027.
Dr. Arthur Stadler, founding partner of the Vienna law firm Stadler Völkel, stated: "It is clear that these licensing procedures will be challenged in administrative courts or even the Constitutional Court, so ultimately issuing online casino licenses may take some time."
Last month, the Austrian People's Party (ÖPV) held joint governance negotiations with the right-wing populist Freedom Party (FPÖ), and many industry insiders were hopeful that Austria would open up the online gambling market.
However, the negotiations subsequently broke down due to disagreements over control of certain ministries, shattering hopes for a major breakthrough. This forced the Austrian People's Party to return to the negotiating table with the center-left Social Democratic Party and the liberal New Democratic Party.
As a result of these joint negotiations, the Social Party will take over the Ministry of Finance. Therefore, before the new government is established, the Social Party will primarily be responsible for re-regulating and supervising the Austrian gambling market.
Future taxes will increase significantly
In addition to disappointment over the restrictive online casino plans, the industry may also face increased taxes under the leadership of the new government.
Austria will gradually increase the gambling tax from the current 2% to 5%, almost on par with neighboring Germany.
Stadler mentioned that there are rumors that the Austrian parliament might vote on the phased increase of the gambling tax as early as this week.
The coalition party also expressed their hope to end the current situation where sports betting regulation and licensing are managed independently by each state.
The government stated in the coalition agreement that they will "review" the current sports betting licensing system to ensure "comprehensive unified regulation and player protection standards."
However, this requires at least a two-thirds majority in the Austrian Federal Parliament and the consent of the states, so it is unlikely to pass.
Furthermore, the parties stated plans to re-regulate loot boxes, which could subject the video game industry to stricter gambling industry-style restrictions. This could have profound effects on anti-money laundering and underage protection.
