The ruling, delivered on 27 February, supported Malta-licensed operators that conducted business in Austria’s market without a local license. The court determined that previous Austrian judgments were contrary to Maltese public policy.
Austria’s online gambling sector is dominated by the monopoly operator Casinos Austria, with its Win2Day offering being the sole licensed online product in the nation.
Like Germany, the market has faced several high-profile claims from players attempting to reclaim losses from offshore operators, deemed illegal within these territories.
Players gambling beyond this monopoly have sometimes found themselves in court, having losses returned from illegal operators, while others have had to pay back winnings to unlicensed operators. Often, the operators involved in these cases are licensed in Malta.
## Malta Judgment
This week’s Maltese ruling pertains to a player who gambled in 2020 and lost €38,325 ($39,845/£31,653) through Malta-licensed operator European Lotto and Betting Limited, operating as Lottoland.
An Austrian court had earlier ruled that the betting party could recover losses due to the operator’s illegality in the market, but the case was brought to a local court by the Malta Gaming Authority (MGA).
Malta’s courts argued that EU Article 56 in the Treaty on the Functioning of the European Union (TFEU) allows for services, such as online gambling, to be provided across EU states.
It serves as a “primary source of community law” and is a “fundamental rule of the legal order” for both the EU and Malta.
Malta’s court also contended that Austria’s federal law on games of chance and its online gaming monopoly contravenes the TFEU.
Consequently, the Maltese court refused to enforce the Austrian judgments, asserting they are contrary to Maltese public policy.
Davinia Cutajar, legal partner at WH Partners, acting on behalf of the MGA, remarked that the decision has significant implications for the gambling industry, as it “reinforces the autonomy of Maltese regulatory authorities and the jurisdiction of Maltese courts over gambling-related matters.”
Cutajar noted that the Austrian monopoly’s compliance with EU law has been questioned multiple times.
She highlighted numerous rulings from the Court of Justice of the European Union (CJEU) that support the view that Austria’s monopoly model breaches Article 56 of the Treaty on the Functioning of the European Union (TFEU).
In a statement, Nigel Birrell, group CEO of Lottoland, welcomed Malta’s landmark decision, stating it reinforced the operator’s previously expressed position on the matter.
## Past Austrian Decisions
In 2021, the Austrian Supreme Court declared that foreign igaming brands were illegally operating in the country, deeming player contracts invalid and prompting players to seek loss recovery.
That decision impacted Betclic Everest subsidiary Bet-at-home, which was ordered to pay €2.8m in player losses almost three years after its market exit (in August 2021).
In another case last year, an Austrian customer had to return their winnings to an unnamed unlicensed operator in the market. The courts found both player and operator had violated Austrian gambling laws, rendering the contract between them invalid.
Ultimately, the decision stated that both parties knowingly operated illegally, resulting in the player being ordered to pay the operator’s court fees.
## Austrian Online Gambling Facing Liberalisation
Such player disputes involving Austria and Maltese-based operators may decrease in the future, as Austria appears poised to end the country’s online casino monopoly.
Casinos Austria was granted a 15-year license and monopoly on online gambling. However, its license will expire on 30 September 2027. Austrian authorities are anticipated to commence the tendering process for new licenses this year.
Simon Priglinger-Simader, Vice President of the Austrian Betting and Gaming Association, expressed optimism for the first time regarding the potential shift away from the monopoly system in Austrian online gambling.
This past December, Maarten Haijer, secretary general of the European Gambling and Betting Association (EGBA), advocated for Austria to open up online gambling.
“The evidence from across Europe is clear and compelling: multi-licensing works,” Haijer stated. “It brings gambling activity into the regulated market, protects consumers, and generates significant tax revenue.”
The Maltese Civil Court has ruled that it will not enforce Austrian court judgments that favored players being awarded refunds for gambling on sites not locally licensed.