Abstract

The European Court of Justice (ECJ) has ruled that players can hope for refunds of stakes in illegal online gambling. EU law allows national gambling bans and consumer claims for reimbursement against providers from other countries. The occasion was a lawsuit by a German player against two Maltese providers, with whom he had lost.

Persons

Topics

  • Gambling bans
  • Online gambling regulation
  • Consumer protection

Clarus Lead

The ECJ decision could pose significant risks for online gambling providers. Millions of euros could have to be repaid to players, as experts say only a fraction of those affected have filed lawsuits so far. The decision could have a signaling effect for numerous proceedings in Germany.

Detailed summary

The ECJ ruled that EU law does not prevent national gambling bans and consumer claims for reimbursement against providers from other member states. The background was the case of a German player who had lost money at two Maltese online gambling providers. He demanded reimbursement, as online gambling was generally prohibited in Germany at the time.

The defendant companies argued that the German ban violated the EU's freedom to provide services and that a Maltese license was also valid in Germany. They also claimed the lawsuits were an abuse of rights, as the players had knowingly used illegal providers.

However, the ECJ rejected these arguments. To protect consumers and combat black markets, member states may restrict the freedom to provide services. Participating in illegal gambling is also not an abuse of rights.

According to experts, online gambling providers now face high repayment risks, as only a small fraction of those affected have filed lawsuits so far. This could have a signaling effect for numerous proceedings in Germany, where courts have often sided with players.

Key statements

  • The ECJ ruled that EU law allows national gambling bans and consumer claims for reimbursement
  • The reason was a lawsuit by a German player against two Maltese online gambling providers
  • Providers unsuccessfully argued that the German ban violates EU law
  • Experts see high repayment risks for providers, as only a small fraction of those affected have sued so far
  • The decision could have a signaling effect for numerous proceedings in Germany

Critical questions

  1. How robust are the ECJ's legal arguments and to what extent could they be challenged in the future?
  2. What conflicts of interest could be at play for the involved online gambling providers?
  3. What alternative explanations might there be for the behavior of players who participated in illegal offerings despite the ban?
  4. What risks and potential side effects could the repayments to players have for the gambling market and consumer protection?

Bibliography

Primary source: EU Court of Justice paves the way for gambling refunds - heise.de

Verification status: ✓ 04/24/2023

This text was created with the support of an AI model. Editorial responsibility: clarus.news | Fact-checking: 04/24/2023