German Federal Court Refers Sports Betting Reimbursement Cases to ECJ Amid Legal Ambiguities

In Germany, a surge in cases where players are seeking to recover losses from sports betting has advanced to the Federal Court of Justice (BGH).

This escalation follows a regional court decision in May that suspended all civil proceedings related to the matter, allowing the European Court of Justice (ECJ) to take charge.

The Federal Court has pointed to the 2012 State Treaty on Gambling, which maintained a blanket prohibition on sports betting without a proper license.

This could potentially render sports betting contracts between players and operators void due to the violation of the treaty.

However, the applicability of this ruling is still debated.

A key factor is whether the betting provider had applied for a German sports betting license, as an earlier ruling indicated that the licensing process itself violated European Union law.

Under EU law, a member state cannot impose criminal sanctions for violating a law if the law in question is found to be in breach of EU regulations.

This legal nuance brings uncertainty to the question of whether the sports betting contracts can be nullified under German civil law.

Local media has identified Tipico as the German sports betting operator involved in this prominent case.

Initially filed in Karlsruhe, the case revolves around a claim for €3,719.26 in losses incurred between 2013 and October 2020. German media reports pinpoint Tipico as the operator at the heart of the controversy.

The case was initially dismissed by a District Court but was later taken to the Court of Appeal.

Court documents from July 25 reveal that the defendant was based in Malta, offering sports betting through a German-language website.

During the disputed period, the operator had applied for a license under the 2012 State Treaty on Gambling but had not received it until October 2020.

This timeline raises another issue: compliance with the maximum monthly stake limit of €1,000, as stipulated by the State Treaty.

The Court of Appeal did not issue a judgment on this matter.

This case is among many involving claims for reimbursement from operators like Evoke (which includes 888 and Mr. Green).

These cases have seen mixed outcomes, with some being dismissed and others advancing through the legal system.

Two parallel proceedings have been paused due to the ECJ's involvement in this primary case.

The German gambling industry remains optimistic that the ECJ will resolve the player reimbursement issues.

Dr. Ronald Reinhart of Redeker Sellner Dahs, representing the defendant in the Federal Court proceedings, expressed confidence that the ECJ will likely dismiss the reimbursement claims.

He highlighted that the primary legal argument hinges on the failure of the 2012 German licensing procedure to comply with Union law, which invalidates the license requirement as per ECJ jurisprudence.

"The reasoning of the court mainly relied on the failure of the German licensing procedure of 2012 ('Konzessionsverfahren') to comply with Union law. That in itself leads to the inapplicability of the license requirement according to the ECJ jurisprudence," Reinhart stated.

He emphasized that nullifying the contracts would severely impact the freedom of services, a fundamental EU principle.

The Deutscher Sportwettenverband (DSWV), Germany's association for sportsbook operators, views the referral to the ECJ as a positive step.

DSWV president Mathias Dahms stated, "The decision of the Federal Court of Justice (BGH) to refer the case to the ECJ shows that clarification under European law is necessary. We are confident that the ECJ will decide in the interests of the providers and the European freedom to provide services, as it has done in the past."