Malta and the EU Edge Toward Legal Showdown over Gambling Regulations
Legal Battle Over Malta’s Gambling Law in the European Court
This week in Luxembourg, the European Court of Justice (ECJ) took on a pivotal case that could reshape the dynamics between individual nations’ gambling regulations and the European Union’s single market policies. Advocate General Nicholas Emiliou shared his opinion in case C-440/23, highlighting an escalating dispute between Malta’s attempt to safeguard its gambling industry and Germany’s push for stronger consumer protections.
The Controversy Surrounding Malta’s Bill 55
Central to this conflict is Malta’s Bill 55, enacted in June 2023, which offers protection to Maltese-licensed gaming operators from claims arising in other EU countries concerning gambling losses. The legislation prevents Maltese courts from enforcing monetary judgments issued by authorities in other member states. The European Commission has challenged this law, asserting that it contradicts the EU’s principle of mutual recognition of judicial decisions.
The specific case before the ECJ involves a German attorney representing a player pursuing repayment for gambling losses. The attorney initiated legal action against two Maltese-licensed operators, contending the contracts with German clients were invalid due to the operators not being authorized under German law. He argued that these firms profited from games prohibited in Germany.
On the other hand, Maltese operators defend their position by invoking the EU’s freedom to provide services. They blame Germany’s restrictive gambling regulations for conflicting with European law, rather than their own business practices. The Maltese court brought the dispute to the ECJ, elevating a private legal issue into a matter of broader legal principle.
Potential Impact of Advocate General Emiliou’s Opinion
Malta has strongly supported its stance. The Malta Gaming Authority (MGA) clarified that Bill 55 does not grant unconditional immunity but aligns with established legal principles that allow courts to refuse foreign judgments when these conflict with public policy. The MGA also pointed out that national restrictions can violate ECJ rulings and hinder market access within the EU.
During Thursday’s hearing, Advocate General Emiliou expressed that requests for reimbursement arising from illegal gambling activities do not amount to misuse of EU law. He further noted that providers are unlikely to succeed in defending themselves by claiming abuse in such cases. However, he emphasized that the final decision remains pending until the ECJ releases its official verdict.
“Until the ECJ provides a clear ruling, it is hypothetical to determine whether Germany’s ban on online gambling breaches EU law,” Emiliou stated.
While the opinion of the Advocate General does not bind the court, it carries significant weight and may shape the outcome. A broad ruling could have widespread effects on gambling operators across Europe, whereas a narrower decision might confine its impact to this specific dispute. The ECJ’s decision will be a critical development in the evolving tensions between Malta and EU institutions over the governance of the online gambling sector.
