The judgment in C-440/23 sits at the intersection of three fault lines in EU law: the freedom to provide services, Member States’ regulatory autonomy in gambling, and the enforceability of cross-border consumer claims. Its implications for Malta’s gaming ecosystem are not marginal—they are structural.

At its core, the case arises from a familiar fact pattern: a German player seeks reimbursement of losses incurred with a Malta-licensed operator active without a German licence. National courts are divided between, on the one hand, protecting consumers through nullity and restitution, and, on the other, respecting cross-border service provision under Article 56 TFEU.

The Court’s approach confirms two key propositions.

First, EU law does not immunise operators from the consequences of breaching host-state gambling regimes. Claims for reimbursement are not, in themselves, an abuse of EU law.

Second, and more significantly, the applicable law, and thus liability, tends to follow the place where the damage occurs, i.e. the consumer’s Member State.

Taken together, this weakens the central premise of the Maltese licensing model: that a licence issued in Malta can effectively anchor operations EU-wide while insulating operators from stricter national regimes.

Impact on Malta’s gaming industry

The immediate consequence is litigation exposure. Thousands of pending or potential claims in Germany and Austria are no longer legally speculative—they are systemically grounded. More fundamentally, the judgment threatens to undercut Malta’s legislative response to this litigation wave, notably Article 56A of the Gaming Act, designed to shield operators from the recognition or enforcement of foreign judgments.

That provision is already under scrutiny by the Commission and widely criticised as protectionist. C-440/23 reinforces the underlying tension: EU private international law and consumer protection rules cannot be neutralised by unilateral “blocking” legislation.

In this procedure leading to the European Lotto judgment (replying to a CJEU request for clarification), the Maltese Court clarified that it did not intend to apply article 56A in this case due to the application of the principle of non-retroactivity. The CJEU noted this commitment in point 59 of the judgment.

59      Second, even if it is found that the application of Article 56A of the Maltese Gaming Act could have rendered the questions referred hypothetical, the referring court stated, in its reply to the request for clarification referred to in paragraph 24 above, that the claim brought by the applicant in the main proceedings had been brought on 21 January 2023, that is to say, before 12 June 2023, the date of entry into force of that provision, which does not have retroactive effect, and, consequently, cannot have any bearing on the dispute in the main proceedings.

A recurring Maltese pattern

This is not an isolated episode. Malta has, in recent years, shown a consistent willingness to legislate at the margins of EU law in economically sensitive sectors: whether through its investor citizenship schemes (“passports for sale”) or its resistance to EU environmental constraints in areas such as spring hunting.

The pattern is recognisable: maximise national economic advantage first, litigate compatibility later. C-440/23 suggests that, in the gaming sector at least, that strategy is reaching its limits.

Malta’s iGaming model has long relied on a simple premise: obtain a licence in Malta, then offer services across the EU from that regulatory base, benefiting from lighter or more industry-friendly rules than those applied in certain target markets. That is the practical reality often described as “regulatory arbitrage”.

What the Court is now making clear is that this model has limits. A Maltese licence does not neutralise the legal consequences of operating in breach of another Member State’s gambling laws. If a service is unlawful where the consumer is located, operators may still face claims there, regardless of where they are licensed.

For operators, this shifts the issue from a technical compliance question to a direct financial exposure. For Malta, it raises a more fundamental point: a system built on exporting services under a single national licence cannot function sustainably if other Member States, and their courts, remain free to impose their own legal consequences.

Links:

Press Release 53/26 – Case C-440/23 | European Lotto and Betting and Deutsche Lotto- und Sportwetten

Judgment of the Court in Case C-440/23 | European Lotto and Betting and Deutsche Lotto- und Sportwetten

Addendum: the beginning of a litigation cycle, not the end

C-440/23 should not be read as a standalone ruling. It is better understood as the opening judgment in a broader line of litigation currently unfolding before the Court of Justice, all circling around Malta’s gaming framework and, in particular, Article 56A of the Gaming Act.

This provision—designed to allow Maltese courts to refuse recognition or enforcement of foreign judgments against Malta-licensed operators—has already triggered systemic friction with EU law, especially the Brussels I bis regime and the principle of mutual trust.

A number of pending cases now place different aspects of that framework under scrutiny. Together, they suggest that the Court will be required to address the issue not only from the perspective of free movement, but also private international law, consumer protection, and judicial cooperation.

Key pending and related cases include:

• Case C-77/24 (Wunner)
  Concerns the law applicable to claims for gambling losses and confirms that liability may follow the consumer’s place of residence under the Rome II Regulation.
• Case C-683/24 (Spielerschutz Sigma)
  Directly questions the compatibility of Malta’s Article 56A with the Brussels I bis Regulation and the system of mutual recognition of judgments.
• Case C-530/24 (Tipico)
  Raises further issues concerning the compatibility of national gambling restrictions with Article 56 TFEU and the validity of cross-border gambling contracts.
• Case C-9/25 and Case C-778/25 (Tipico)
  Part of a broader wave of references dealing with liability for gambling losses and related private international law questions in the context of Malta-licensed operators.
• Case C-898/24 (TSG Interactive Gaming Europe)
  Another reference linked to cross-border gambling disputes, illustrating the scale and replication of litigation in this field.

Taken together, these cases indicate that C-440/23 is not the conclusion of the legal debate, but the first step in what is likely to become a sustained judicial examination of Malta’s gaming model.

The direction of travel is clear: what began as individual reimbursement claims is evolving into a systemic test of how far a Member State can go in shielding its licensed operators from the legal effects of other Member States’ laws and judgments.