BWin is the newest sports betting brand of Austrian public company Bet and Win.
The Saxony state government announced this week that it is banning the BWin gaming operations.
The ruling has worsened the share stocks price problems that were caused by previous profit warning.
The German state had barred the BWin to accept sports bets in Germany.
The move to ban BWin has caused a deep slump in the groups stocks.
BWin, one of the largest sports betting companies, has suffered a slump of thirty percent at last Wednesdays closing and another fifteen percent decrease the following day.
The huge drop in BWin stocks were last seen eighteen years ago.
The Interior Minister of Saxony said that accepting sports bets, including the advertising, without the government approval is considered illegal.
Juergen Staupe, junior minister of Saxony, said that the ban applies to the whole of Germany regardless of where the license was obtained.
The license of BWin was from the East German authorities prior to the unification.
The betting company was given two weeks to answer the allegations and after which the ruling will take effect.
BWin is mulling legal action over the license removal