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The Higher Administrative Court of Saxony-Anhalt has dealt a setback to Malta-based operator Red Rhino, as it confirmed the legality of a payment blocking order issued by Germany’s gambling regulator GGL.

Last month, the GGL fined Red Rhino €50,000 for offering online gambling in Germany despite an enforceable prohibition order.

The regulator also penalised a payment service provider associated with Red Rhino Limited, though the provider’s name was not disclosed. 

The GGL further prohibited this payment provider from processing any payments on behalf of Red Rhino.

In response, Red Rhino sought interim legal protection against the payment blocking order, contending that it could impact deposits and withdrawals for operations outside Germany not subject to the ban, a situation known as “overblocking”.

However, the court rejected this request, citing Red Rhino’s lack of authorisation to operate in Germany.

The court also held the view that the “principle of proportionality” was not breached, even though it recognised that payment service providers may not always be able to conclusively discern whether a payment originates from Germany or abroad during the deposit process.

However, the court argued that payment service providers can demand evidence that the operator has taken adequate technical measures to prevent unregulated gambling. 

It added that even in cases where payment service providers are instructed to cease business with an operator, payment blocking orders can still align with the principle of proportionality. 

The court stipulated that the GGL must exercise discretion in each specific case. 

Nonetheless, given that “illegal gambling in Germany was a main component of the applicant’s business,” the court deemed the decision reasonable.

The decision is legally binding.

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