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 inconsistent with Maltese public policy.
Austria’s online gambling landscape is dominated by the monopoly operator Casinos Austria. Its Win2Day offering is currently the only licensed online product in the country.
The market, alongside Germany, has faced several high-profile player loss claims where players have attempted to reclaim losses from offshore operators as they are considered illegal within these markets.
Players gambling outside this monopoly have found themselves in court, having their losses returned by illegal operators in the market, while others have had to repay winnings to unlicensed operators. In many cases, the operators involved in these cases are licensed in Malta.
## Malta Judgment
The Maltese ruling this week concerned 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 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 have argued that EU Article 56 in the Treaty on the Functioning of the European Union (TFEU) provides for services, such as online gambling, to be offered 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 contended that Austria’s federal law on games of chance and its online gaming monopoly violate the TFEU.
Therefore, the Maltese court has refused to enforce the Austrian judgments, stating that they contradict Maltese public policy.
Acting on behalf of the MGA, Davinia Cutajar, legal partner at WH Partners, said 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 Austrian monopoly’s compliance with EU law has been questioned multiple times.
She stated that numerous rulings from the Court of Justice of the European Union (CJEU) supported 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 as he said 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, prompting players to seek to recover their losses.
That 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 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 and that the contract between them was, therefore, invalid.
Essentially, the decision ruled that both parties knowingly operated illegally, and the player was ordered to cover 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 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.
This past 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 not locally licensed.