Online gambling: players may recover losses from games banned in their country

Brussels – Online gamblers may claim a refund for lost stakes from operators based in another EU Member State if the games were prohibited in their country of residence.

 The judgment announced today by the Court of Justice of the European Union in proceedings brought by two companies established in Malta, holders of a license issued by the Maltese authority responsible for gambling, which offer virtual slot machine games and betting on the results of lottery draws. Between June 2019 and July 2021, a player residing in Germany used these services and lost several bets. However, at the time of the events, German law prohibited almost all forms of online gambling, including virtual slot machines and betting on the lottery draw results. 

Upon discovering this, the player decided to “take a chance” on getting his lost money back, and the matter has therefore been referred to the courts. 

At the conclusion of the proceedings, in its judgment, the Court states that “EU law does not preclude national legislation prohibiting the organization of
online casino games, slot machine games and certain forms of betting, such as betting on the results of lottery draws,
with the aim of steering gambling activities into supervised channels and combating parallel markets.” Furthermore, EU law “does not preclude recognition of the legal consequences of such a prohibition despite the subsequent
introduction of a system of approval, nor the nullity of contracts concluded in breach of that prohibition, nor a
civil action for restitution of the stakes lost.” 

Online gambling constitutes a service for the purposes of the Treaties of the European Union, and the freedom to provide such services “may be
restricted for overriding reasons in the public interest, in particular, consumer protection and the protection of social order.
In the absence of harmonization and given the moral, cultural, and social differences between Member States, the latter
enjoy discretion in determining the level of protection sought.” 

According to European magistrates, online gambling poses greater specific risks in this regard than gambling in physical venues, “particularly due to the permanence of access, the isolation and anonymity of the
player, the absence of social control, the potentially unlimited frequency, and its attractiveness to young and vulnerable
persons.” Therefore, “in that context, a Member State may prohibit online casino games, including slot machines, and certain forms of online betting, while permitting other forms of gambling, including in physical establishments, or subjecting certain online
gambling activities to distinct regimes.” 

According to the Court, “EU law does not therefore, in principle, preclude a finding that a contract concluded between a consumer and an operator
established in another Member State, relating to services prohibited in the consumer’s Member State, is void”, and therefore “an action for restitution of the stakes lost is not precluded by EU law.”