A recent ruling by the Court of Justice of the European Union strengthened players’ ability to recover online gambling losses across borders under their home laws, but stopped short of directly challenging Malta’s controversial legal protections for the iGaming industry under a legal amendment known as Bill 55.

“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 to establish liability in tort or delict on the part of the directors of a foreign provider that does not hold the required licence,” the court’s statement reads.

The judgment confirms that, as a general rule, players may rely on the law of their country of residence when bringing non-contractual claims linked to online gambling, even where the operator is established and licensed in another EU member state, such as Malta. 

But, more crucially, it does not touch Malta’s legal framework, notably Bill 55, which can shield gambling companies from enforcing foreign courts’ judgements. 

“The Court did not examine, question, or assess the validity of Malta’s regulatory framework,” Malta Gaming Authority’s spokesperson told Amphora Media.

Commenting on Amphora’s earlier findings about the way Malta’s laws protect gambling operators, lawyer Benedikt Quarch, who has represented numerous German and Austrian gamblers, has earlier explained to Amphora Media that his firm would bring “thousands of cases to Malta” once the EU courts declared the bill void.

What the Court decided: The case involving an operator in Malta

The EU court case began with an Austrian client who used a Maltese operator, Titanium Brace Marketing, which did not hold the licence required under Austrian law. 

According to the judgement, the Austrian player accumulated losses between November 2019 and April 2020.

The player decided to bring a case against the operator’s two directors before the Austrian courts, arguing that they are “jointly and severally liable for the fact that Titanium offered illegal games of chance in Austria”. The directors argued that not Austrian but Maltese law should apply.

The directors also argued that they should not be liable for the company’s offer of gambling services without a national licence. 

Filings at Malta Business Registry show that a Cypriot national and a Maltese national were appointed directors of the company in September 2019. In 2021, the Maltese director resigned and the Cypriot signed a document initiating the dissolution of the company, which is ongoing.

In 2024, the Austrian Supreme Court put questions to the EU Court of Justice to clarify whether the directors are liable and which law should apply.

According to the government of Austria, “cross-border supply of gambling activities is not allowed”. But Malta-based firms operate websites without licenses in some countries they target.

Gambling laws are not harmonised in the EU, and there is no obligation for authorities to recognise gambling licences from another EU country.

There is case law that repeatedly recognises the rights of EU countries to restrict the cross-border market of gaming services, but restrictions (such as more stringent criteria for a national licence) must be proven to be proportionate.

The top EU court ruled that “the damage sustained by the player is deemed to have occurred in the country in which that player resides”. In this case it’s Austria, so Austrian law should apply.

Moreover, failing to obtain a gambling license is a breach of a general law protecting the public, not an internal company management issue. 

This means it does not fall under the company law exception, which would be protecting the directors from liability. It remains for the Austrian courts to rule whether the directors are guilty, but this should be done under the law governing non-contractual obligations and not company law.

Bill 55’s fate is yet undecided

Although not directly addressed by the recent ruling, Bill 55 is also under EU scrutiny.

Under Bill 55, Maltese courts can “refuse recognition and, or enforcement” of any foreign judgment involving companies registered on the island, namely the gambling industry.

In an interview with iGaming Capital, lawyer Terrence Cassar explained that the relevant article introduced by Bill 55 “would only ever come into play at the point where a foreign judgment is presented for recognition and enforcement in Malta.” 

“At that stage, the Maltese legal position is that such a judgment would simply not be recognised,” he said.

MGA’s spokesperson also underscores the limited scope of the ruling:

“It is also important to emphasise that this judgment was strictly limited to the interpretation of the Rome II Regulation (Regulation 864/2007), which determines which country’s law applies in civil and commercial matters involving non-contractual claims.”

“The Court did not pronounce itself on the substance of the underlying player claim. It does not relate to Article 56A (formerly Bill 55), which addresses a different legal context and reflects Malta’s established public policy on gaming matters,” the spokesperson added.

Amphora Media analysed Maltese court cases since the adoption of Bill 55. We found 81 first-instance judgements involving gambling companies and 32 appeals that cited the relevant legislation.

Not all of these were court judgements about refunding gambling losses. The court issued interim judgements on many procedural requests, responding to challenges brought by either side – the gambler or the company – including garnishee orders and requests for recusal.

“In light of the narrow and technical nature of this judgment, Malta’s position vis-à-vis the player claims remains that operators licensed in Malta may continue to operate cross border where they have a justifiable legal reason to do so,” MGA’s spokesperson said. 

However, more rulings may be in the pipeline. 

In June last year, the European Commission also opened infringement proceedings against Malta “for failing to comply with its obligations under the Regulation on jurisdiction and the recognition and enforcement of judgements (Regulation (EU) 1215/2012) in the area of gambling”.

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