Austria’s new coalition to continue online casino monopoly

In the wake of unsuccessful negotiations between the conservative Austrian People’s Party (ÖVP) and the right-wing populist Freedom Party (FPÖ), Austria has established a new three-party coalition. This coalition has opted to maintain the current monopoly model rather than transitioning to an open market—at least for the immediate future.

The coalition agreement, finalized on March 2, unites the centre-right People’s Party (ÖVP), the Social Democrats (SPÖ), and the Liberal Party (NEOS). Collectively, these parties have indicated their intent to preserve the existing licensing structure for online gambling in Austria.

This coalition emerged in February following a protracted period of political instability, which started with parliamentary elections in September that failed to produce a clear majority. Subsequent attempts at coalition-building experienced numerous setbacks and breakdowns.

The Austrian Betting and Gaming Association (OVWG), however, remains cautiously optimistic. Their interpretation of the coalition’s language suggests that there may be opportunities for reform of the existing monopoly in the future.

“Our discussions with policymakers indicate that the issue of online gambling licenses was not settled at the formation of the government,” stated Simon Priglinger-Simader, Vice President of the OVWG. “Numerous key figures in the new government are advocating for modernizing the online gambling market to align it with European standards. Clearly, the potential for reforming the monopoly system and opening the market to online gambling is still under consideration.”

Continuation of the Single License Model

The coalition agreement highlights that when the current online casino license—held exclusively by Austrian Lotteries—expires in 2027, the government intends to issue just one additional license for online casinos, effectively extending the existing monopoly for another 15 years.

Additionally, the agreement sets forth a commitment to intensify enforcement actions against the growing number of unlicensed operators in the market.

Specifically, the coalition aims to implement aggressive measures against illegal gambling, including “internet blocking and payment blocking,” as stated in the agreement. The sole licensed online gaming operator, currently running the Win2Day platform, is operated collaboratively by Austrian Lotteries and Casinos Austria, the latter serving as the monopoly provider for land-based casinos in the country.

Austrian Lotteries secured this monopoly in 2012 through a contentious tender process overseen by the Austrian Finance Ministry. Industry stakeholders raised concerns at the time, arguing that the complexity of operating across various gambling verticals—such as online casinos, lottery systems, and slot machines—could not be effectively managed by a single entity. Furthermore, the Finance Ministry’s 33.3% stake in both Casinos Austria and Austrian Lotteries has led to accusations of potential conflicts of interest.

This sentiment echoes throughout Europe, particularly in Nordic countries where similar monopoly structures persist.

Establishment of a New Gambling Authority

To navigate the challenges presented by previous licensure processes, the newly formed coalition aims to create an independent gambling authority during this legislative period. This body would assume the responsibilities of the Finance Ministry in managing the upcoming tender processes for both online and land-based casino licenses.

While a specific timeline for this authority’s establishment has yet to be announced, industry experts warn that the deadline is tight, given the imminent expiration of several licenses in 2027. Dr. Arthur Stadler, founding partner at the Vienna-based law firm Stadler Völkel, notes, “It’s evident that any licensing processes will likely face challenges in administrative courts and potentially at the Constitutional Court, meaning the final awarding of the online casino license could be delayed.”

Many industry observers had held out hope for a shift toward a more liberalized online gambling market as the ÖVP engaged in coalition talks with the FPÖ. However, those negotiations collapsed due to disputes over ministerial control, forcing the ÖVP back into negotiations with the SPÖ and NEOS.

As a consequence of these negotiations, the SPÖ will oversee the Finance Ministry, thus taking charge of re-regulating and supervising the Austrian gambling market until the new authority is in place.

Anticipated Tax Increases

Compounding the disappointment surrounding the continued restrictions on online casinos, the gambling industry may face increased tax burdens under the new administration. Austria is set to gradually escalate the betting tax from the current 2% to 5%, aligning it more closely with the rates in neighboring Germany.

According to Dr. Stadler, discussions about this phased increase in betting duty could take place in the Austrian Parliament as early as this week.

The coalition also expressed a desire to address the fragmentation in sports betting regulation and licensing, which currently operates on a state-by-state basis. Their agreement mentions plans to “review” the existing system of sports betting licensing to establish “uniform supervision and player protection standards across the board.”

However, achieving these goals will require at least a two-thirds majority in the Austrian federal parliament and the support of the federal states, posing a significant challenge to potential legislative advancements.

Finally, as part of their regulatory overhaul, the coalition plans to introduce measures aimed at regulating loot boxes, which could impose gambling-industry-like restrictions on the video game sector. This initiative could have profound implications for anti-money laundering (AML) practices and the safeguarding of minors within the gaming environment.