Austrian Supreme Court Orders Refunds For Online Casino Losses

September 1, 2021
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An Austrian Supreme Court ruling has held that foreign online casino operators are illegal, their contracts with players are invalid and gambling losses should be refunded.

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An Austrian Supreme Court ruling has held that foreign online casino operators are illegal, their contracts with players are invalid and gambling losses should be refunded.

Austria’s Supreme Court upheld lower court rulings in a €1.1m ($1.3m) case which sided with a plaintiff who is seeking a refund of gambling losses, based on an argument that the online casino operators are unlicensed and thus illegal.

Casinos Austria holds a monopoly on online casino through its win2day unit.

The defendant had argued that the Austrian monopoly violates European Union law, but the court dismissed that assertion, in a June ruling that was only recently released to the public.

Neither the plaintiff nor the defendant were fully identified in the lawsuit resolution, but Austrian media said the gambling operator was Entain’s Gibraltar-based ElectraWorks, which operates the bwin brand.

“We are disappointed with the court’s decision and will keep all of our legal options under review,” an Entain spokesman said, while declining to discuss the specifics of the case.

“We continue to offer our services to Austrian customers,” he said.

In contrast, Tipico, Germany’s biggest sports betting company, said it shut its Tipico Casino in Austria in February.

That step, however, has had no impact on its Austrian sports-betting operations, a spokesman said.  

Tipico, owned by CVC Capital, recently expanded into the US market in New Jersey.

Advofin Litigation Financing, a Vienna-based company that has financed gambling lawsuits in Austria and Germany, said it funded the player whose case made it to the Supreme court.

“The highest courts have confirmed the notion of our lawyers: when an online gambling operator is offering services in Austria without an Austrian licence, this offer is illegal”, said Stefan Bohar, an Advofin board member.

“Therefore, the contract with the customer is invalid and the money paid to the provider has to be returned to the customer,” he said.

The company currently has more than €60m in claims and more than 1,000 lawsuits in the works, he said.  

Despite companies’ legal setbacks, the Austrian Association for Betting and Gambling (OVWG) said it does not consider the matter closed.

“New arguments, legal studies and scientific research on this topic are constantly presented, both in the national courts of appeal and at the [European Court of Justice], providing legal evidence that the monopoly in Austria is contrary to European Union law,” said the trade group’s president, Claus Retschitzegger.

The OVWG is also in the process of preparing a complaint to the European Commission, he said.

Lawyer Christian Rapani said the casino-refund cases stem from a July 2017 Supreme Court ruling that has since been supported by more Austrian case law.

Despite these unfavourable rulings, online operators continue to challenge the claims, “with valid arguments”, the Graz-based attorney said.

“For obvious reasons, operators are closely monitoring these developments and are constantly re-evaluating their offering in Austria,” he said.

         

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