Authors: FFF Legal (Malta - TAGLaw) & Gecić Law (Montenegro & Serbia - TAGLaw)
On 16 April 2026, the Court of Justice of the European Union (“CJEU” or the “Court”) issued its judgment in Case C-440/23, European Lotto and Betting and Deutsche Lotto und Sportwetten, addressing the compatibility of national restrictions on cross-border online gambling services with the freedom to provide services.
In its ruling, the Court held that EU law does not preclude a Member State from prohibiting certain online gambling services, notwithstanding that such services are authorised in another Member State.
It further confirmed that Member States may attach civil-law consequences to infringements of such prohibitions, including the nullity of contracts and the possibility of restitution of lost stakes.
For gaming operators, this means they must assess local gambling rules in every country in which consumers can access their platforms, including the rules that applied in earlier periods, not only those in force today. The judgment confirms that past non-compliance may still give rise to present-day consequences, including consumer claims and the risk that contracts will be treated as void.For consumers resident in a Member State which is different to the one in which the online gaming business is licensed, this means that money lost may be recoverable. The CJEU has confirmed that such claims are governed by national law. Since limitation periods depend on national law, prompt legal action is important.
The case arose in relation to two companies established in Malta and licensed by the Maltese Gaming Authority, which offered online virtual slot machine games and betting on the results of lottery draws. Those services were accessible, inter alia, in Germany. Between June 2019 and July 2021, a consumer residing in Germany used those services and incurred losses.
At the material time, German law imposed a general prohibition on online games of chance, subject to limited exceptions such as sports betting, horse-race betting, and certain lotteries. Virtual slot machines and betting on lottery results fell within the scope of that prohibition. The consumer initiated proceedings seeking restitution of the sums lost. Those claims were subsequently assigned to a company, which pursued the action before a Maltese court.
The referring court sought clarification as to whether the freedom to provide services precludes such national legislation where the operator holds a licence in another Member State. It also raised questions concerning the effects of a subsequent reform of German law, which replaced the general prohibition with a system of prior authorisation, as well as the legal consequences relating to the nullity of contracts and restitution.
The Court held that national legislation prohibiting the organisation of online casino games, slot machine games and certain forms of betting, including betting on the results of lottery draws, may be justified by public interest reasons. These include the objective of directing gambling activities into controlled and supervised channels and combating parallel markets.
It further held that EU law does not preclude the recognition of the legal consequences of such a national prohibition, notwithstanding the subsequent introduction of a national system of prior approval. Nor does it preclude the nullity of contracts under national law concluded in breach of that prohibition or civil actions for restitution of the stakes lost.
The Court reiterated that online games of chance constitute services within the meaning of the EU Treaties. However, restrictions on the freedom to provide such services may be justified by public interest reasons, in particular consumer protection and the protection of social order. In the absence of harmonisation, and in light of moral, cultural and social differences, Member States retain discretion in determining the level of protection sought.
In that regard, the Court recognised that online gambling presents specific risks, including 24/7 access, the isolation and anonymity of the player, the absence of social control, the potentially unlimited frequency of participation, and its particular appeal to young and vulnerable persons.
Within this context, a Member State may prohibit certain forms of online gambling, including online casino games and slot machines, while permitting other forms of gambling, including in physical establishments, or subjecting certain activities to distinct regulatory regimes. Neither significant consumer demand nor the fact that an operator is lawfully established and supervised in another Member State is sufficient to render such a prohibition inconsistent, as each Member State remains free to determine its own level of protection.
The subsequent replacement in Germany, with effect from 1 July 2021, of the general prohibition by a system of prior authorisation did not affect the consistency or validity of the earlier regime. Such a development may form part of a policy of controlled expansion aimed at directing consumers towards authorised gambling services. Similarly, the existence of a transitional period did not preclude the application of legal consequences to conduct occurring during the earlier period.
Accordingly, EU law does not preclude a finding under the national law of a Member State 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.
Finally, the Court held that an action for restitution of gambling losses is not precluded by EU law. The nullity of the contract and its consequences fall within the scope of the applicable national law, in this instance German law. In so far as the national legislation is compatible with EU law, such nullity arises from the illegality of the contract. The consumer’s participation in the games, notwithstanding the existence of a licence in another Member State, is not in itself sufficient to establish an abuse of rights under EU law, any assessment of bad faith being a matter for national law.
Earlier this year, the Court took a similar approach in Case C-77/24 Wunner. It found that a consumer may rely on the law of their own country when bringing a tort claim against directors of a foreign online gambling operator that does not hold the required licence for that market.
Taken together, these cases are likely to strengthen consumer claims across the EU and give further momentum to the growing wave of restitution litigation that is already underway in Germany and Austria.
This also brings renewed focus to Article 56A of Malta’s Gaming Act, which was introduced in 2023 to protect Malta-licensed operators from foreign claims and judgments. Article 56A is now the subject of infringement proceedings by the European Commission, which began in June 2025.
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