A German court has suspended two cases involving player losses pending regulation and formally asked the European Court of Justice (ECJ) to clarify key legal issues surrounding the regulation of online gambling.
The Erfurt Regional Court’s ruling follows a similar referral made last year by the German Federal Court of Justice (BGH) in a dispute between a sports bettor and Malta-based operator Tipico.
The Erfurt Regional Court formally referred the LG Erfurt cases 8 O 391/23 and 8 O 515/24 to the ECJ in December, one of which concerned online gambling and the other sports betting.
According to lawyer Stefan K. Grunow, the Erfurt court’s submission goes beyond the original BGH referral, presenting more detailed and extensive legal issues.
While the BGH only posed two general questions, the Erfurt court formulated four key questions, which were further divided into specific sub-questions.
At the heart of the Erfurt court’s decision are concerns about the inconsistent application of gambling regulations in Germany at the time.
The court is seeking clarification as to why some forms of online gambling, such as lotteries and horse racing betting, were permitted while online casino games were prohibited.
Also troubling is the assumption that the authorities’ apparent tolerance of online gambling, despite the formal ban, has legal consequences.
In addition, the court wonders why identical slots and poker games were permitted in physical casinos but banned online. And how Schleswig-Holstein was able to issue gambling licenses independently while the rest of Germany adhered to a nationwide ban.
The Erfurt court also challenges whether sufficient evidence has ever been presented to substantiate the claim that online gambling poses a greater risk than brick-and-mortar gambling, and whether the ban has effectively curtailed black market gambling.
In addition, the court asks whether German authorities have the right to impose fines or reject compensation claims if the ban on online gambling is in conflict with EU law.
If the ban is found to be in breach of European rules, the court will examine whether operators will be exempt from criminal or administrative sanctions, and whether civil claims for compensation by players will remain valid.
In a related matter, the court is also seeking clarification on the rationale for introducing deposit limits for online gambling when brick-and-mortar casinos and betting companies have no such limits or operate under significantly different rules.
Grunow explained that German law allows lower courts to independently seek guidance from the European Court of Justice if they find a potential conflict with EU rules, even if similar issues are already under consideration.
The ECJ must now consider a number of legal issues submitted by both the BGH and the Erfurt Regional Court.
While the cases could eventually be heard together, Grunow suggested that a decision in 2025 is unlikely given the complexity and breadth of the issues involved.
Even if the ECJ sides with players in the initial Tipico case referred by the BGH, “the risk that at least some aspects could be decided in favour of the providers by the ECJ must also be kept in mind.
“It is currently not possible to reliably estimate how this will affect pending legal proceedings,” Grunow stated.
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