Earlier this month, the German Federal Court of Justice (BGH) was scheduled to conduct a crucial hearing concerning the obligation of unauthorized gambling operators to refund players’ losses.
However, the hearing has since been cancelled due to the defendant, an Austrian sports betting operator, choosing to withdraw its appeal.
Halt or Yield: A Directive to All German Civil Courts
With respect to a regional court’s ruling on these class actions associated with player reimbursements, all German civil courts are mandated to either halt proceedings or yield to a higher jurisdiction, the BGH included.
The proceedings were spearheaded by Germany’s Hambach & Hambach law firm.
The verdict stipulates that all online casino and sports betting disputes falling under the umbrella of European Union laws will be presided over by the European Court of Justice (ECJ).
The ECJ is to be entrusted with the final adjudication in these cases.
In the interim, the BGH has received critique over its alleged reluctance to forward a request to the ECJ, as it neither halted nor yielded during a ruling in March involving a sports betting case.
Ruling on Reimbursement Could Establish an Alarming Benchmark
Claus Hambach, a partner at Hambach & Hambach, along with senior associate Phillip Beumer, opine that a verdict enforcing refunding players’ losses could potentially nurture a risky precedent in the country.
Given that this hot-button issue is already making headlines and with assertions made by spokespeople of the “player claim industry,” a surge of legal disputes and complaints could be imminent.
Hambach & Hambach voiced concern that if players see a reimbursement from unlicensed operators, it could result in an unexpected upsurge of the illegal gambling market.
Their reasoning is that such recompense could be misconstrued as an incentive to bet through unregulated operators, considering the “risk of loss” will essentially disappear.
As stated by a study in 2023 by the University of Leipzig, almost half of all online gambling in Germany is enacted through offshore operators.
The data also showcased that a staggering three-quarters of online revenue were hogged by black market operators, resulting in tax losses amounting to hundreds of millions.
This has prompted the German Online Casino Association and the German Sports Betting Association to solicit the German gambling regulator to nudge players towards using licensed operators through attractive incentives.
In the previous month, we reported that Betano might be obligated to reimburse a player’s loss of EUR 12,000, with the FCJ on the cusp of announcing its final judgment.
During the wager period of 2018, the operator had not secured the necessary official permit to function in Germany, setting off this drawn-out legal battle.
