The ruling delivered on 27 February supported Malta-licensed operators doing 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 landscape is predominantly controlled by the monopoly operator Casinos Austria, with its Win2Day offering being the only licensed online product in the country.
The market, alongside Germany, has experienced several high-profile player loss claims, where players have tried to reclaim losses from offshore operators deemed illegal within these markets.
Players gambling outside this monopoly sometimes found themselves in court, with outcomes ranging from recouping losses from illegal operators to repaying winnings to unlicensed operators. Many of these operators hold licenses in Malta.
## Malta Judgment
The Maltese ruling this week involves a player who gambled in 2020 and lost €38,325 via the Malta-licensed operator European Lotto and Betting Limited, operating as Lottoland.
An Austrian court had previously ruled that the betting party could recover their losses due to the operator’s illegality in the market, but the case was brought to a local court by the Malta Gambling Authority (MGA).
Malta’s courts argued that EU Article 56 in the Treaty on the Functioning of the European Union (TFEU) allows for services, like online gambling, to be offered across EU states.
It serves as a “primary source of community law,” 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 breaches the TFEU.
As a result, the Maltese court declined to enforce the Austrian judgments, stating they are contrary to Maltese public policy.
Representing the MGA, Davinia Cutajar, legal partner at WH Partners, said that the decision has notable 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 highlighted that the compliance of the Austrian monopoly with EU law has been questioned on multiple occasions.
She noted that numerous rulings from the Court of Justice of the European Union (CJEU) have supported 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 the landmark decision in Malta, claiming it reinforced the operator’s previously expressed stance on the issue.
## Past Austrian Decisions
In 2021, when the Austrian Supreme Court ruled foreign igaming brands were illegally operating in the country, player contracts were deemed invalid, allowing players to seek to recoup losses.
That decision affected Betclic Everest subsidiary Bet-at-home, which was ordered to pay €2.8m in player losses almost three years after its market withdrawal.
Last year, an Austrian customer was ordered to return their winnings to an unnamed unlicensed operator. The courts found that both the player and operator had violated Austrian gambling laws, rendering the contract between them void.
Essentially, the decision concluded that both parties knowingly operated illegally, and the player was ordered to cover the operator’s court fees.
## Austrian Online Gambling Facing Liberalisation
This type of player dispute involving Austria and Maltese-based operators may reduce in the coming years as Austria is likely on the brink of ending the country’s online casino monopoly.
Casinos Austria was awarded a 15-year license and a monopoly on online gambling. However, its license is set to expire on 30 September 2027. Austrian authorities are expected to initiate the tendering process for new licenses this year.
Austrian Betting and Gaming Association VP Simon Priglinger-Simader expressed optimism that Austrian online gambling could transition away from the monopoly system.
In December, European Gambling and Betting Association (EGBA) president secretary general Maarten Haijer called for Austria to open up online gambling. “The evidence from across Europe is clear and compelling: multi-licensing works,” Haijer said. “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 without a local license.