Betfair makes the most of new gambling law

Online betting exchange operator Betfair has been awarded a licence to operate its betting exchange in the German state of Schleswig Holstein.

The firm intends to pay 20% of its gross gaming revenue to the state in return for the licence. This move is expected to reduce the company's gross margin by about one percentage point.

Betfair's Chief Legal and Regulatory Affairs Officer, Martin Cruddace, said: "We are delighted to have been awarded one of the first three licences to operate in Schleswig Holstein. We look forward to making a significant and sustainable contribution to the newly formed market there, offering consumers innovative products in a safe and responsible betting environment.

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"Schleswig Holstein's government should be applauded for its efforts to implement a regulatory regime that will provide security for consumers, transparency for regulators and the freedom to compete for EU operators."

Only last year the state brought in new laws that in March 2012 liberalised gambling regulations in the region. Germany has long enforced strict laws on gambling, partly to ensure state lottery schemes don't suffer from competition. The vote to pass a law allowing online gambling in the state was passed by just one vote.

The share price rose 4.53% to 830.50p by 12:30.

NR