Germany to Reimburse Illegal Gambling Losses: Court Hearing in May

The Federal Court of Justice of Germany (BGH) is ready to organize a hearing on recompensating losses for users with unregulated brands.

The 1st Civil Senate of the Federal Court of Justice of Germany (BGH) will set up a hearing on 2 May. This will be focused on the repayment of customer losses from gambling with unlicensed brands.

The solution has been presented by a plaintiff (claimant). It was initially released by the Lower Court of Dresden back in 2023.

The defendant is a company from Austria, sports betting brand that provided betting opportunities to German users during 2018.

According to the court documents, it is explained that the sports betting offer was illicit. This is because it did not fulfill the conditions of Section 4 Paragraph 5 No 2 GlüStV 2012 (Germany’s State Treaty for Online Gambling), which entails monthly max wager per customer.

It is also directly against the Section 4 Paragraph 5 No 5 GlüStV 2012, which splits sports betting and other gambling forms. The defendant also provides a cash-out function, something that is unallowed as per the State Treaty.

Thanks to the lawsuit, the plaintiff also requires that the defendant reimburse the payments completed in the sum of the suffered failures equal to €11,984.89 and interest.

What About Repayment Claims for Enforcement Gambling Losses

As per the opinion of Hambach & Hambach, the leading operators are not situated in Germany, and they do not hold assets in Germany which will lead to enforcement.

In most situations, every region would ensure the chance to challenge the enforceability of foreign judgements. However, if players look to enforce judgements in the operator’s state of licensing that would probably lead to rejection.

Setting up a Norm for Illegal Losses:

On this occasion, Munich law firm Hambach & Hambach, that is also specialized in gambling law has analyzed the existing atmosphere in Germany.

Following the opinion of Hambach & Hambach member Claus Hambach and senior associate Phillip Beumer, decision in the plaintiff’s favor will be a precedent for the country:

“The Federal Court of Justice, Germany’s highest Civil Court, has recently published an extensive note, outlining its preliminary view that a players could in principle be entitled to being refunded their losses from participating in sportsbook offers.”

What About Interest for Reimbursement of Losses

Hambach & Hambach agree that recompensating players will be risky for the country. They also explain the reasons for such mindset. First off, this will cause the spread of black market but also motivate players to place wagers with illegal operators knowing they could get compensation for that.

It is also worth noting that recent study by University of Leizig showed that almost a half of online gambling is still taking place with unregulated operators, another great problem for the whole country.

Source:

“Germany to decide on reimbursing illegal gambling losses”, igamingbusiness.com, April 9, 2024.