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 landscape is dominated by monopoly operator Casinos Austria, with its Win2Day offering currently the only licensed online product in the country.
This market, along with Germany, has faced numerous high-profile player loss claims, where players have attempted to reclaim losses from offshore operators deemed illegal within these markets.
Players who gamble outside this monopoly have found themselves in court, having losses returned from illegal operators, while others have had to pay back winnings to unlicensed operators. Many of these cases involve operators licensed in Malta.
## Malta Judgment
The Maltese ruling this week involves 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 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 (like online gambling) to be provided across EU states.
It acts 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 has also argued that Austria’s federal law on games of chance and its online gaming monopoly go against the TFEU.
As such, the Maltese court has refused to enforce the Austrian judgments, stating that they are contrary to Maltese public policy.
Acting on behalf of the MGA, Davinia Cutajar, a 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 on several occasions.
She said that numerous 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 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 considered 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 the player and operator had violated Austrian gambling laws and that their contract was, therefore, 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 Liberalisation
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 given a 15-year license and a monopoly on online gambling. However, its license is due 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 earlier this month that Austrian online gambling could move 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 in favor of players being awarded refunds for gambling on sites that were not locally licensed.