The second part of the Decoding Gaming Law podcast series in collaboration with CBS Group hosted by Dr Franklin Cachia, features Dr JP Gauci-Maistre, managing director of Guaci-Maistre Xynou. Since the last episode, two landmark Maltese court decisions ruled that foreign claims against Malta based gaming operators cannot be enforced due to public policy grounds and Article 56a of the Gaming Act. The conversation highlights the ongoing legal uncertainty within the EU gaming industry.

Landmark judgments in Malta

“It’s been a whirlwind”, says Dr. Gauci, due to two recent First Hall Civil Court decisions in Malta that refused to recognise and enforce Austrian court judgments against Malta based gaming operators. Austrian players had sought to recover lost gambling funds by enforcing local judgments in Malta but Maltese courts ruled otherwise. “Although there were decisions like them before, these were much more studied,” Gauci explains. “They took a comprehensive view, not just based on law, but on Malta’s broader public policy.”.

Public policy, though broad and at times fluid, became the crux of the court’s reasoning. “Public policy is essentially what the state perceives as its economic direction and public interest,” says Gauci. “A government’s manifesto can become the public policy of the country.”.

The Maltese courts viewed the enforcement of Austrian judgments as potentially undermining Malta’s gaming framework, which plays a pivotal role in the country’s economy. “The judge said: ‘I’m going to listen to everything’ from the State Advocate, to expert witnesses, to the Malta Gaming Authority CEO,” he adds. “It was a 66-page decision grounded in detailed analysis.”.

EU gaming law 

Dr. Gauci also touches on the tension between EU wide principles like the freedom to provide services and national sovereignty in regulating industries like gaming. Austrian courts, operating within a monopolistic system have challenged Malta based operators. However, the Maltese judiciary upheld that these foreign rulings conflicted with Malta’s legal protections and public interest. “Article 56A of the Gaming Act clearly states that operators and their officers aren’t liable for these types of claims,” explains Gauci. “But the judge went further, he said, even without this article, I’d still refuse to enforce based on public policy.”.

Ongoing appeals

These decisions are currently under appeal, and as Gauci notes, this remains “an ongoing story.” Precedent setting references have also been submitted to the European Court of Justice (ECJ) to determine the compatibility of national laws with EU treaties. “We have preliminary references pending, one from Austria, another from Malta, testing the limits of EU freedoms in this context,” says Gauci.

Additionally, the discussion touches on how unresolved player claims could influence insolvency proceedings in Malta. If claims are not recognised, some operators may not be deemed insolvent, a situation that could reshape the sector’s legal landscape.

Dr. Gauci emphasises the complexity and importance of these developments, “This isn’t just about one piece of legislation. It’s about understanding the broader interest of the country, the validity of licenses, and Malta’s standing within the EU.” As the gaming landscape continues to evolve, legal clarity and regulatory alignment are more crucial than ever. Don’t miss your chance to explore these issues further at SiGMA Euro-Med, taking place in Malta in September, where leading experts, regulators and operators come together to shape the future of gaming.