The ruling, delivered on 27 February, supported Malta-licensed operators that engaged in business within Austria’s market without holding a local license. The court determined that previous Austrian judgments contradicted Maltese public policy.
Austria’s online gambling scene 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 attempted to reclaim losses from offshore operators deemed illegal in these markets.
Players gambling outside this monopoly have sometimes been successful in court, winning back losses from illegal operators, while others have been required to return winnings to unlicensed operators. Many of these operators are licensed in Malta.
## Malta Judgment
The recent Maltese ruling involves 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 player could recover their losses due to the operator’s illegality in the market, but the Malta Gambling Authority (MGA) brought the case to a local court.
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 serves 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 conflict with the TFEU.
As a result, the Maltese court declined to enforce the Austrian judgments, stating they were contrary to Maltese public policy.
Acting on behalf of the MGA, Davinia Cutajar, legal partner at WH Partners, stated 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 Austria’s monopoly’s compliance with EU law has been questioned on several occasions.
She mentioned that several 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, stating 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, and players sought to recoup their losses.
That decision affected Betclic Everest subsidiary Bet-at-home, which was ordered to pay €2.8 million 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 the contract between them was therefore invalid.
Ultimately, 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 might decrease in the coming years as Austria seems 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, the license is set to expire on 30 September 2027. Austrian authorities are expected to begin 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) 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.