The ruling, delivered on 27 February, supported Malta-licensed operators that had conducted business in Austria’s market without a local license. The court decided that previous Austrian judgments opposed Maltese public policy.
Austria’s online gambling scene is dominated by the monopoly operator Casinos Austria, with its Win2Day offering being the only licensed online product in the country.
The market, along with Germany, has witnessed several high-profile player loss claims where players have attempted to recover losses from offshore operators deemed illegal within these markets.
Players gambling outside this monopoly have found themselves in court recuperating losses from illegal operators in the market, while others have had to return winnings to unlicensed operators. Often, the 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) via the Malta-licensed operator European Lotto and Betting Limited, operating as Lottoland.
An Austrian court had earlier decided that the betting party could reclaim their losses due to the operator’s illegality in the market, but the case was brought before 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) provides for services like online gambling to be offered 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 also contended that Austria’s federal law on games of chance and its online gaming monopoly contradict the TFEU.
Therefore, the Maltese court has refused to enforce the Austrian judgments, stating they are against 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 Austria’s monopoly’s compliance with EU law has been questioned on multiple occasions.
She mentioned in a post on the firm’s website that numerous rulings from the Court of Justice of the European Union (CJEU) supported the viewpoint that Austria’s monopoly model breaches Article 56 of the Treaty on the Functioning of the European Union (TFEU).
In a statement to iGB, Nigel Birrell, group CEO of Lottoland, welcomed the landmark decision in Malta as 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, and players sought to recoup their losses.
That decision affected Betclic Everest subsidiary Bet-at-home, which was ordered to pay €2.8m in player losses almost three years after its market withdrawal in August 2021.
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, rendering their contract 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 Liberalization
This type of player dispute involving Austria and Maltese-based operators could decrease in the coming years as Austria is likely to end the country’s online casino monopoly.
Casinos Austria was granted 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 commence the tendering process for new licenses this year.
Austrian Betting and Gaming Association VP Simon Priglinger-Simader expressed optimism for the first time ever that Austrian online gambling could shift 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 that were not locally licensed.