Online gambling: CJEU allows stakes to be reclaimed

The case

A player resident in Germany used the online offerings of two companies based in Malta between 5 June 2019 and 12 July 2021. They offered virtual slot machine games and bets on the outcome of lottery draws, known as secondary lotteries (Zweitlotterien), and held a Maltese licence but no German authorisation. The player lost money and wanted his stakes back. He assigned his claims to a third party, who brought an action before a Maltese court. That court referred several questions to the CJEU (EuGH) (judgment of 16 April 2026, Case C‑440/23).

Which law applies

The providers' terms and conditions provided for Maltese law. However, the CJEU clarifies that contracts with consumers are governed by the law of the State of their habitual residence if the provider directs its activities to that State, and that a choice of law may not deprive the consumer of this protection (Art. 6 Rome I Regulation). The subsequent assignment of the claim does not change this either. Because the player used the offerings from Germany, the German prohibitions also had to be taken into account.

The ban and the freedom to provide services

Under the Interstate Treaty on Gambling (Glücksspielstaatsvertrag) of 2012, which was in force at the time, organising and brokering games of chance on the internet was in principle prohibited in Germany. There were exceptions for, among other things, certain sports and horse-race betting and the distribution of state lotteries. The providers relied on the freedom to provide services under Art. 56 TFEU.

The CJEU does not regard this as an infringement. A ban on online casino games and online secondary lotteries can be justified if it is intended to channel the propensity to gamble into controlled channels and to counteract black markets. In the Court's view, neither considerable demand nor the fact that similar games were permitted in gaming venues or that sports and horse-race betting were authorised online changes this. Games on the internet entail their own dangers, such as easy and constant access and the lack of personal contact, and the individual types of game may be regulated differently. Nor does the State have to prove that it obtained scientific studies before adopting the rules. The fact that the provider is licensed in Malta and that similar objectives apply there is not sufficient, and the special arrangement in Schleswig-Holstein, limited in time and territory, does not call the rules as a whole into question either.

The transitional period until July 2021

At the end of 2019, the German federal states (Länder) agreed to replace the ban with a system of official authorisation and not to take action against certain offerings for the period until 30 June 2021. The CJEU considers this irrelevant: a controlled opening of the market is compatible with the objective of protecting players, and the transitional arrangement does not change the legal consequences of the ban for the case decided.

Secondary lotteries

Bets on the outcome of lottery draws with private providers could also be prohibited in Germany. The fact that lotteries were reserved for state operators played no role in the dispute, because the ban on the internet applied to all operators and intermediaries. EU law does not preclude the nullity of such a contract.

No abuse of rights

The providers argued that the player was acting abusively by reclaiming his money after playing. The CJEU does not agree. The action is not based on EU law but solely on German law. Whether the player knew about the ban and what consequences this has is determined by the applicable national law.

What this means for those affected

The decision strengthens the position of players who lost money with providers without a German licence during the period of the ban: EU law does not stand in the way of a claim for repayment. Whether a claim exists, and in what amount, is governed by German law and depends on the individual case, for example on the period, the provider and what the player knew about the ban. Under the Brussels Ia Regulation (Art. 18(1)), consumers can in principle also bring an action at their place of residence. A licensing system has applied in Germany since 1 July 2021, so the legal position is different for later games with providers licensed in Germany.

This article is for general information purposes only and does not replace advice in an individual case.