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Read Full BioThe Court of Justice of the European Union (CJEU) has issued a ruling in a case brought by an Austrian gambler that could have widespread implications for gamblers in Europe.
The case centres on a dispute between Austria and Malta over which country’s laws should apply to online gambling. The CJEU sided with Austria, ruling that local law should prevail.
In its ruling, released on Thursday, the CJEU stated that in cases related to online games of chance, “a player may, as a general rule, rely on the law of his or her country of residence when bringing an action.”
Case Background
The legal challenge was initiated in 2022 by an Austrian player who sued Titanium Brace Ltd, the company behind online casino DrückGlück, which was licensed in Malta, but not in Austria.
The gambler is attempting to recover losses of €18,547.67 (about $21,000) incurred on the platform between 2019 and 2020. The complaint alleges that these losses should be voided as the company did not hold a valid license to offer gambling in Austria.
Austria has a closed market for online gambling, with only brands operated by the operator Casinos Austria licensed in the country. There have been calls to open the market, with critics arguing that the monopoly also violates EU standards.
Malta Says Laws Compliant With EU
Malta, however, argues that its laws do not violate EU law. The Malta Gaming Authority has defended Bill 55, which protects companies licensed in the country, saying it is “in full conformity with EU law.”
Article 56A of the bill states that Malta will not uphold any European court judgment that deemed their services illegal in that market.
Other countries have criticized the article, including Germany’s gambling regulator, which said it also believes it violates EU law.
In June last year, the European Commission wrote a formal letter to Malta’s government, saying the clause does not comply with European law.
Ruling Puts Pressure on Maltese Licensed Companies
The CJEU’s ruling could reinforce that belief across Europe and lead to increased claims against companies with offshore licenses. The CJEU noted that it has not passed judgment on the case in Austria, stating, “The Court of Justice does not decide the dispute itself. It is for the national court or tribunal to dispose of the case in accordance with the Court’s decision, which is similarly binding on other national courts or tribunals before which a similar issue is raised.”
It could, however, put pressure on Malta to enforce any ruling brought in the Austrian courts, including compensating the gambler who lost money at DrückGlück.
Many gambling companies are based in Malta for its favorable tax rates and more relaxed licensing laws, but to operate in an individual country, platforms usually require local licenses.
It remains to be seen whether Malta will follow the CJEU’s ruling and punish companies prosecuted in other European countries.
