The legal battle between Austria and Malta is set to escalate as the use of Article 56A, more commonly known as Bill 55, has been triggered by Malta Courts in a move to disregard determinations made by the European Court of Justice on long-running disputes between the two jurisdictions.
Malta is going head-to-head with European courts over Bill 55, citing Article 56A of the Maltese Gaming Act to protect its own domestic law, allowing the country’s courts to refuse any foreign judgments that undermine the provision of Maltese gaming licensing.
Article 56 of the Treaty on the Functioning of the European Union (TFEU) is being utilised by the operator as the foundation for its case – the right to freely provide services across EU member states – as what is being protected in Maltese law through Article 56A.
Rather than disregarding rulings of the European Court of Justice, Maltese courts are applying public policy exceptions under the Brussels I Recast Regulation (EU) 1215/2012, reinforced domestically by Article 56A, to block the enforcement of foreign civil decisions that they argue undermine Malta’s gaming regulatory framework.
The judge on the case argued that siding with the Austrian court’s decision would undermine the licence of the Malta Gaming Authority (MGA),
The case threatens to have major consequences on the European gaming ecosystem and the ability of an MGA licence to offer services in EU markets. Formal infringement proceedings over Bill 55 were launched by the European Commission last summer.
Going forward, operators using a Malta licence to operate elsewhere in Europe could be forced to seek a licence across each jurisdiction they operate in if any appeals side with the applicant. This could be the case as well if regulators decide to consider such cases as part of their joint fight against the black market.
Malta positions Bill 55 as a safeguard of its domestic law, allowing courts to reject foreign judgments that conflict with the validity of licences issued by the Malta Gaming Authority (MGA). The dispute has significant implications for Europe’s online gambling landscape, particularly around the cross-border supply of services by MGA-licensed operators.
The case now looks set to escalate, with the European Court of Justice (ECJ) previously detailing the significant lengths that EU Courts could extend to as they bid to strengthen action against Malta operators.
According to the Advocate General (AG) of the ECJ, the framework could shift to dilute the effectiveness of Bill 55 when it comes to Malta safeguarding its domestic operators.
In a significant referral, the Advocate General has put forward the case to enable international authorities to freeze the assets of Malta-based companies in the event of local breaches.
While no final judgment has yet struck down Article 56A, an Advocate General of the ECJ has signalled that European enforcement tools could be interpreted in ways that dilute Malta’s ability to shield operators.
Among the options highlighted is the potential use of the European Account Preservation Order (EAPO) Regulation, which could allow foreign authorities to freeze assets of Malta-based companies in cross-border disputes — even where Maltese courts refuse judgment enforcement.
An aligned approach to tackling operators that aren’t licensed in their jurisdiction has been a central focus of European regulators, with Austria, France, Germany, Italy, Portugal, Spain and Great Britain all uniting in strategy.
Regulators from “Illegal online gambling undermines the entire regulatory framework designed to protect the public interest,” read the UKGC statement.
“Its borderless nature and the speed of technological innovation make it easier for illegal operators to evade regulatory oversight. This creates significant risks for consumer and public health protection, endangers public order and harms the activity of legitimate operators.”
The group has committed to sharing information on illegal operators, as well as knowledge and better practices in identifying, investigating and sanctioning operators outside the law.
Speaking specifically on Bill 55, previously, the GGL has stated: “We are of the opinion that this law should not be compatible with European requirements for the recognition of decisions (Regulation (EU) 1215/2002).
“However, the final assessment of this question is not the responsibility of the GGL. We have informed the federal states of our assessment and are otherwise in contact with the relevant authorities.”
