German lawmakers recently approved a parliamentary proposal to recognise esports as a non-profit activity. This will enable esports clubs to obtain tax exemptions and public support. The government also acknowledged the role of esports in youth development through competitive events, categorising it as an accepted social activity.
Esports Gains Non-Profit Status in Germany: Top Takeaways
- Germany has the biggest esports market in the European Union, with a reported annual revenue of €160 million as of 2024. The country is home to several globally acclaimed esports teams.
- The German federal cabinet approved a draft law to classify esports as a non-profit activity. If approved by the parliament, esports teams will gain access to benefits available to traditional sports teams.
- Getting recognised as a non-profit will allow esports teams to seek tax benefits, similar to sports teams. It will also create opportunities for public funding, grants, and public support, comparable to what established sports like football have.
German Cabinet Approves Non-Profit Status for Esports
From January 1, 2026, esports will be classified as a non-profit activity in Germany. According to the Federal Ministry of Research, Technology, and Space’s LinkedIn post, a draft legislation to classify esports as non-profit has just been cleared by the federal cabinet.
The draft law still has to be approved by the parliament to be enacted into legislation. If the law takes effect, esports clubs will gain access to benefits reserved for traditional sporting clubs. This move is part of the coalition government’s efforts to promote esports in the country, which has been thriving for the past several years.
According to the eSport-Bund Deutschland’s 2025 annual report, Germany remained Europe’s largest esports market, generating €160 million in revenue in 2024. Sponsorship deals accounted for nearly 50% of the earnings. The country is home to several globally renowned esports teams, such as G2 Esports, MOUZ, and Berlin International Gaming (BIG).
The popularity of esports in the past five years has fuelled a steady demand for esports betting. The GGL, which regulates the domestic gambling market, recently published its first-ever quarterly revenue report. The country also introduced a dedicated esports visa in 2020 to streamline travelling within the EU for esports athletes from outside the region.
Implications for the German Esports Industry
Being recognised as a non-profit allows German esports teams to leverage the benefits reserved for traditional sports teams. German esports teams can enjoy tax exemptions and apply for grants, donations, and public funding. This will enable them to gather and allocate resources for overall development and growth.
The draft law highlights the role of esports in youth development. It underlines the notion that esports are on a par with traditional sports, such as football and basketball, in terms of helping young people nurture teamwork, improve strategic reasoning, and practice discipline through structured organisation.
These experiences contribute to the social development and personal growth of young people, similar to traditional sports. The government has also announced plans to protect young people from the dangers of esports. The directive calls for precaution against excessive gaming, promotes sensible gaming duration, and offers help for improving the mental health of young gamers.
The global esports market is experiencing an upward trend and is estimated to generate $16.21 billion by 2025. Germany is well-represented in competitive games like Counter-Strike 2, which has a global fan base. However, the country lags behind China and South Korea in infrastructure and competitiveness.