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 landscape is dominated by monopoly operator Casinos Austria. Its Win2Day offering is currently the sole licensed online product in the country.
The market, alongside Germany, has experienced numerous 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 have ended up in court, sometimes recovering losses from illegal operators, while others have had to return winnings to unlicensed operators. Many of the operators involved in these situations hold licenses in Malta.
## Malta Judgment
The recent Maltese ruling concerns a player who gambled in 2020 and lost €38,325 ($39,845/£31,653) with Malta-licensed operator European Lotto and Betting Limited, operating as Lottoland.
An Austrian court had previously ruled that the betting party could reclaim their losses due to the operator’s illegality in the market. However, 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 provided across EU states.
This serves as a “primary source of community law,” 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 contradict the TFEU.
As a result, the Maltese court refused to enforce the Austrian judgments, declaring them against Maltese public policy.
Acting for the MGA, Davinia Cutajar, legal partner at WH Partners, mentioned 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 highlighted that the Austrian monopoly’s compliance with EU law has been questioned frequently.
She stated that many rulings from the Court of Justice of the European Union (CJEU) support the view 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, asserting it reinforced the operator’s previously expressed position 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, leading players to seek recoupment of their losses.
This decision affected Betclic Everest subsidiary Bet-at-home, which was ordered to pay €2.8m in player losses nearly three years after its market exit.
In another case last year, an Austrian customer was instructed to return their winnings to an unnamed unlicensed operator. The courts concluded that both player and operator had violated Austrian gambling laws, invalidating the contract between them.
This decision essentially concluded that both parties knowingly operated illegally, resulting in the player being 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 as Austria seems poised to end 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 anticipated to begin the tendering process for new licenses this year.
Austrian Betting and Gaming Association VP Simon Priglinger-Simader expressed optimism that Austrian online gambling could shift away from the monopoly model.
Last 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 it will not enforce Austrian court judgments that favored players being awarded refunds for gambling on sites that were not locally licensed.