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 in opposition to Maltese public policy.
Austria’s online gambling environment is predominantly controlled by the monopoly operator Casinos Austria. Its Win2Day service is the only officially licensed online product in the country.
The market, alongside Germany, has encountered several high-profile player loss claims where players have attempted to reclaim losses from offshore operators, as these are considered illegal within these regions.
Players who gamble outside this monopoly have sometimes seen their losses refunded by courts from illegal operators, while others have been required to repay winnings to unlicensed operators. Often, the operators involved in these cases hold licenses in Malta.
## Malta Judgment
The Maltese ruling this week pertains to a player who gambled in 2020 and lost €38,325 ($39,845/£31,653) via Malta-licensed operator European Lotto and Betting Limited, which operates as Lottoland.
An Austrian court had previously decided that the betting party could recover their losses due to the operator’s illegality in the market, but the case was presented 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 acts as a “primary source of community law” and 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 contradicts the TFEU.
Consequently, the Maltese court has refused to enforce the Austrian judgments, stating that they are inconsistent with Maltese public policy.
Representing 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 Austrian monopoly’s compliance with EU law has been questioned multiple times.
She mentioned that numerous rulings from the Court of Justice of the European Union (CJEU) supported the stance 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, saying it reinforced the operator’s previously stated position on the matter.
## Past Austrian Decisions
In 2021, when the Austrian Supreme Court ruled that foreign igaming brands were operating illegally in the country, player contracts were declared invalid, and players sought to recover their losses.
That decision impacted Betclic Everest subsidiary Bet-at-home, which was ordered to pay €2.8m in player losses almost three years following 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 determined that both player and operator had violated Austrian gambling laws and that the contract between them was therefore invalid.
Essentially, that decision ruled that both parties knowingly acted 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 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.
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 ruled that it will not enforce Austrian court judgments that favored players being awarded refunds for gambling on sites that were not locally licensed.