Luxembourg appears to be at a crossroads as to how its gambling market will be regulated, with ministers divided between market liberalisation or the reintroduction of a full state-controlled monopoly under its 48-year-old gambling law.

Political concerns over gambling addiction in the Grand Duchy have grown in 2025, due to the ease of online gambling being promoted to citizens of Luxembourg via foreign media networks and internet service providers (ISPs).  

Deliberations in October saw Dan Biancalana of the Luxembourg Socialist Party call on the government to curb the spread of interactive gaming machines in cafés and update restrictions on online betting and casino platforms..

In response, Justice Minister Elisabeth Margue confirmed that reform is underway to grant exclusive rights to the National Lottery and the country’s sole casino, Casino 2000, in Mondorf-les-Bains.

Under the proposal, cafés would be limited to National Lottery-operated terminals, with all other gaming devices including skill-based machines prohibited. On online gambling, the government is considering whether to allow the casino to operate a licensed platform, while assessing technical implications under European law on geo-blocking and player protection.

“According to European case law, you can create such a monopoly, but then you must protect your citizens,” Margue told parliament, adding that “complex discussions are ongoing with all concerned parties” to determine the scope of reform.

National media outlets report that the Justice Ministry has begun consultations with the National Lottery, Casino 2000, and other ministries on the structure of a potential state-run monopoly to control both retail and online gambling channels.

Currently, Luxembourg’s gambling activity remains limited to the Loterie Nationale and Casino 2000, with proceeds from lottery and sports betting supporting social and cultural projects through the Œuvre Nationale de Secours Grande-Duchesse Charlotte.

While European law allows for a monopoly system in gambling, Luxembourg must demonstrate that it can engineer such a model to serve in the “public-interest objectives  of harm prevention and consumer protection” — rather than state revenue generation.

The monopoly debate continues reforms initiated earlier this year, when the Justice Ministry initiated discussions to overhaul the 1977 Gambling Law,, to combat illegal and unlicensed betting. The new framework aims to address unregulated machines in restaurants and adapt to the “realities and challenges of the 21st century.”

However, PM Luc Frieden has so stood on the sidelines of the debate, emphasising awareness and player responsibility over restrictive legislation. He highlighted the National Lottery’s responsible-gambling measures, including transparent odds, betting limits, and educational campaigns about the social and psychological consequences of gambling.

Sports betting has been legal only since 2009 and is offered exclusively via LoterieSport.lu, a subsidiary of Loterie Nationale launched in 2024 — at the time  promoted by the government as “the safest and most secure environment for Luxembourg nationals to gamble on”

The ongoing parliamentary debate has outlined a potential hybrid framework, preserving state control through the National Lottery while granting a single, regulated online concession to Casino 2000.

Another scenario under review would see Luxembourg ring-fence its licensing system, issuing a limited number of permits for specific gambling activities. However, such an approach could conflict with EU competition and single-market principles, particularly around free movement of services and market access.

2026 will reveal whether policymakers favour state stewardship as the most effective path to curb addiction and illegal play — or whether a more open, competitive licensing model aligned with wider European trends ultimately prevails.