The ruling delivered on 27 February supported Malta-licensed operators that had 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 arena is dominated by monopoly operator Casinos Austria, with its Win2Day offering being the only licensed online product in the country.
This market, alongside Germany, has witnessed several high-profile claims where players have attempted to reclaim losses from offshore operators deemed illegal within these regions.
Players gambling outside this monopoly have sometimes been successful in court, receiving refunds from illegal operators. However, others have been required to return winnings to unlicensed operators. Many of these operators are licensed in Malta.
## Malta Judgement
The recent Maltese ruling involves a player who gambled in 2020, incurring losses of €38,325 via Malta-licensed operator European Lotto and Betting Limited, operating as Lottoland.
An Austrian court had previously ruled that the player could recover their losses due to the operator’s illegality in the market. However, 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) permits services like online gambling to be provided across EU states.
This article acts as a “primary source of community law,” regarded as a “fundamental rule of the legal order” for both the EU and Malta.
Malta’s court further argued that Austria’s federal law on games of chance and its online gaming monopoly contravene the TFEU.
Consequently, the Maltese court refused to enforce the Austrian judgments, stating that they contradict Maltese public policy.
Representing the MGA, Davinia Cutajar of WH Partners highlighted the ruling’s 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 also noted that the Austrian monopoly’s compliance with EU law has been questioned several times.
She pointed out that numerous rulings from the Court of Justice of the European Union (CJEU) support the stance that Austria’s monopoly model violates Article 56 of the TFEU.
In a statement, Nigel Birrell, CEO of Lottoland, welcomed Malta’s landmark decision, stating it reinforced the operator’s previously expressed stance on the matter.
## Past Austrian Decisions
In 2021, when the Austrian Supreme Court ruled that foreign igaming brands were illegally operating in the country, player contracts were deemed invalid, allowing players to recoup their losses.
This decision impacted Betclic Everest subsidiary Bet-at-home, which was ordered to pay €2.8m in player losses nearly three years after its market withdrawal in August 2021.
In another case last year, an Austrian customer was ordered to return their winnings to an unnamed unlicensed operator. The courts found that both player and operator violated Austrian gambling laws, rendering their contract invalid.
This essentially meant 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 might decrease, as Austria is likely moving towards ending the country’s online casino monopoly.
Casinos Austria was granted a 15-year license and a monopoly on online gambling, but this license is set to expire on 30 September 2027. Austrian authorities are expected to start the tendering process for new licenses this year.
Austrian Betting and Gaming Association VP Simon Priglinger-Simader expressed optimism that Austrian online gambling could break away from the monopoly system.
Last December, European Gambling and Betting Association (EGBA) president secretary general Maarten Haijer called for Austria to open its online gambling market.
“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 favoring players being awarded refunds for gambling on sites not locally licensed.