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 market is dominated by the monopoly operator Casinos Austria, with its Win2Day offering being the only licensed online product in the country.
The market, similar to Germany, has faced numerous high-profile player loss claims where players have sought to reclaim losses from offshore operators deemed illegal within these jurisdictions.
Players who gamble outside this monopoly have found themselves in court, where they have sometimes recovered losses from illegal operators, while others have been required to repay winnings to unlicensed operators. Many operators involved in these cases are licensed in Malta.
## Malta Judgment
The recent Maltese ruling pertains to 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 bettor could recover their losses due to the operator’s illegality in the market. However, the case was taken to a local court by the Malta Gaming 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 acts as a “primary source of community law,” which is a “fundamental rule of the legal order” for both the EU and Malta.
The Maltese court further contended that Austria’s federal law on games of chance and its online gaming monopoly contradict the TFEU.
Therefore, the Maltese court declined to enforce the Austrian judgments, stating they were against Maltese public policy.
Davinia Cutajar, acting on behalf of the MGA and a legal partner at WH Partners, said the decision significantly impacts 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 compliance of Austria’s monopoly with EU law has been questioned on several occasions.
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 TFEU.
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, the Austrian Supreme Court ruled that foreign igaming brands were illegally operating in the country, invalidating player contracts and enabling players to recoup 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 withdrawal.
In another case last year, an Austrian customer was ordered to return their winnings to an unnamed unlicensed operator. The courts found that both the player and operator violated Austrian gambling laws, rendering their contract invalid.
Essentially, this decision determined that both parties knowingly operated illegally, ordering the player to pay the operator’s court fees.
## Austrian Online Gambling Facing Liberalisation
These types of player disputes involving Austria and Maltese-based operators could decrease as Austria is likely on the brink of ending the country’s online casino monopoly.
Casinos Austria was granted a 15-year license and a monopoly on online gambling. However, this license is set to expire on 30 September 2027, with Austrian authorities expected to begin the tendering process for new licenses this year.
Austrian Betting and Gaming Association VP Simon Priglinger-Simader recently expressed a hopeful outlook for Austrian online gambling to move away from the monopoly system.
In December, the European Gambling and Betting Association (EGBA) president-secretary general, Maarten Haijer, urged Austria to open up online gambling.
“The evidence from across Europe is clear and compelling: multi-licensing works,” Haijer noted. “It brings gambling activity into the regulated market, protects consumers, and generates significant tax revenue.”
The Maltese Civil Court has decided not to enforce Austrian court judgments that favored players being granted refunds for gambling on sites that were not locally licensed.