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 scene is dominated by the monopoly operator Casinos Austria. Its Win2Day platform is currently the only licensed online product available in the country.
The market, along with Germany, has experienced several high-profile player loss claims where players have attempted to recover losses from offshore operators, deemed illegal in these markets.
Players who gamble outside this monopoly have often found themselves in court, reclaiming losses from illegal operators in the market, while others have had to return winnings to unlicensed operators. Many of the operators involved in these cases are licensed in Malta.
## Malta Judgment
The Maltese ruling this week concerns a player who gambled in 2020 and lost €38,325 ($39,845/£31,653) via 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 illegality of the operator in the market, but the case was brought to a local court by the Malta Gambling Authority (MGA).
Malta’s courts have argued that EU Article 56 in the Treaty on the Functioning of the European Union (TFEU) allows for services (like online gambling) to be provided across EU states.
It serves as a “primary source of community law,” which is a “fundamental rule of the legal order” for both the EU and Malta.
Malta’s court also argued that Austria’s federal law on games of chance and its online gaming monopoly conflict with the TFEU.
As such, the Maltese court has refused to enforce the Austrian judgments, asserting that they contradict Maltese public policy.
Acting on behalf of the MGA, Davinia Cutajar, legal partner at WH Partners, stated 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 also noted that the compliance of the Austrian monopoly with EU law has been questioned on multiple occasions.
She mentioned in a post on the firm’s website that various rulings from the Court of Justice of the European Union (CJEU) supported the position that Austria’s monopoly model violates 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, saying 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, and players sought to recoup their losses.
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 withdrawal.
In another case last year, an Austrian customer was ordered to return their winnings to an unnamed unlicensed operator in the market. The courts found that both player and operator had violated Austrian gambling laws, rendering the contract between them invalid.
Essentially, that decision ruled that both parties knowingly operated illegally, and the player was ordered to pay the operator’s court fees.
## Austrian Online Gambling Facing Liberalization
This type of player dispute involving Austria and Maltese-based operators could decrease in the coming years as Austria is likely on the verge of ending the country’s online casino monopoly.
Casinos Austria was granted 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 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 move 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 that were not locally licensed.