Malta’s legal defence of its gaming framework and licensing system has suffered another setback after a ruling from the European Court of Justice (ECJ), which sided with the interpretation that EU member states may restrict online gambling services from operators licensed in other member states without breaching EU law.
The case forms part of a wider dispute between German authorities and Malta-based gambling operators, including divisions of Lottoland, over the enforcement of national gambling restrictions versus EU “freedom to provide services” principles. The ECJ’s preliminary ruling confirmed that countries such as Germany can maintain bans on online slot machines and certain lottery betting products, and that players may also pursue damages against operators that were unlicensed or operating in breach of national rules.
The conflict stems from long-running disagreements over whether Maltese Gaming Authority (MGA) licenses should allow operators to offer services across the EU under the Treaty on the Functioning of the European Union (TFEU), which guarantees freedom of services within the bloc.
Germany’s fragmented regulatory system was eventually replaced by the Interstate Treaty on Gambling, which came into force in July 2021 after years of negotiations between federal states. The reform introduced a formal licensing framework for online gambling, but disputes remain over activity that occurred before regulation was fully established.
Malta has consistently argued that MGA-licensed operators were acting lawfully under EU internal market rules during periods when Germany’s regulatory system was inconsistent or incomplete.
Key Cases and Operators Involved
The ECJ ruling relates in part to disputes involving Malta-based companies such as Tipico and Lottoland, which operated in Germany (and in some cases Austria) during the late 2010s and early 2020s without valid local licences at the time.
Some cases involve customers seeking compensation for losses incurred between 2013 and 2021. In Tipico’s case, the operator later obtained a German licence following market re-regulation in 2021, but had previously operated without one. Lottoland is also facing claims tied to earlier activity before stricter enforcement regimes were fully in place.
While the ruling directly concerns the Lottoland-related proceedings, it is expected to influence other ongoing disputes involving Malta-based operators and cross-border enforcement actions.
The ECJ stated that Article 56 TFEU “must be interpreted as not precluding national legislation which imposes a prohibition on the organization of online casino games, in particular slot machines, and of forms of betting such as online betting on the results of lottery draws.”
Implications for Malta’s Legal Position
The decision weakens Malta’s long-standing argument that EU freedom of services protections should override restrictive gambling regimes in other member states when operators hold an MGA licence.
Malta has built much of its regulatory approach around this interpretation, particularly through its controversial “Bill 55” framework, formally an amendment to its Gambling Act introduced in 2023.
Bill 55 gives Maltese courts authority to refuse the enforcement of foreign judgments against Malta-licensed gambling companies when those rulings conflict with Maltese law. The policy was designed to protect the country’s iGaming sector, which accounts for an estimated 10% of Malta’s GDP, from a growing number of cross-border lawsuits.
Malta argues that this safeguard is necessary to prevent a surge in foreign claims and to ensure stability for operators licensed under its jurisdiction. Critics, however, see it as a mechanism that limits the effectiveness of other EU member states’ judicial decisions.
The ECJ ruling does not fully resolve the wider legal conflict between Malta and other EU jurisdictions, but it strengthens the position of national regulators like Germany in enforcing local gambling laws against offshore-licensed operators.
As legal disputes continue across multiple jurisdictions, Malta’s role as a major iGaming hub remains under scrutiny, particularly as other regions including Estonia and the United Arab Emirates seek to attract gambling operators with competing regulatory frameworks.
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