A recent judgment of the Maltese courts has delivered the first clear judicial endorsement of Article 56A of the Gaming Act, confirming Malta’s position on the non-recognition of foreign judgments that undermine the validity of gaming services provided under a
Malta Gaming Authority (“MGA”) licence.
Brief Overview
The case arose from an Austrian judgment ordering an MGA-licensed operator, Virtual Digital Services Limited, to refund approximately €488,000 to an Austrian player. The Austrian court concluded that the operator’s services were unlawful under Austrian gambling law because the operator did not hold a local licence. The claimant sought to have that judgment recognised and enforced in Malta under Regulation (EU) 1215/2012. The Maltese operator resisted recognition, relying, among other grounds, on Article 56A of the Gaming Act. The Court accepted this defence and refused recognition.
Article 56A Applied
Article 56A, introduced in 2023, establishes as a matter of Maltese public policy that courts must refuse to recognise foreign judgments which negate the legality of gaming services lawfully provided under an MGA licence.
The Court rejected arguments that Article 56A could not apply to proceedings commenced before its enactment, holding that procedural rules apply immediately to pending cases where no vested rights have crystallised.
It also dismissed the contention that activities prohibited under foreign law cannot qualify as legitimate under “regulatory instruments” for the purposes of Article 56A. The Court confirmed that the relevant regulatory instruments are those forming part of Maltese law and MGA regulation - not foreign gambling legislation.
No Conflict with EU Law
Importantly, the Court distinguished earlier cases in which Article 56A had been disapplied. Those decisions concerned a different EU regulation that contains no public policy exception. By contrast, Regulation 1215/2012 expressly allows Member State courts to refuse recognition on public policy grounds.
Since Article 56A operates squarely within that exception, the Court found no conflict with EU law and no basis to disregard the provision.
The existence of infringement proceedings initiated by the European Commission against Malta was also held to be irrelevant. Until ruled otherwise by the Court of Justice of the European Union, Article 56A remains valid law and must be applied.
The Underlying Principle: Free Movement of Services
The Court grounded its reasoning in substance rather than form. It identified the right of MGA-licensed operators to provide services across the EU under Article 56 TFEU as a fundamental element of Malta’s legal order.
Recognising a foreign judgment that strips effect from rights conferred by Maltese law was held to constitute a manifest breach of Maltese public policy. The Court stressed that it was not ruling on the compatibility of Austrian gambling law with EU law, but on Malta’s obligation, or lack thereof, to enforce regulatory choices that negate its own licensing regime.
Beyond Article 56A
Recent jurisprudence shows that Article 56A is not the sole basis upon which Maltese courts are refusing to recognise Austrian player recovery judgments.
In a separate January 2026 judgment, the Maltese courts reached the same conclusion by relying directly on EU law principles and the public policy exception in Regulation 1215/2012, without invoking Article 56A at all. That analysis focused on the primacy of EU law, the free movement of services, and the validity of licences issued by the MGA.
The Court also noted structural inconsistencies in the Austrian regulatory framework and highlighted the conceptual contradiction inherent in player recovery claims that allow losses to be reclaimed while winnings are retained from the same allegedly unlawful activity.
Conclusion
Maltese courts have now articulated a clear and consistent position. Foreign judgments that fundamentally undermine the legitimacy of Malta’s gaming licensing framework will not be recognised or enforced. Article 56A provides a statutory basis for this outcome where Regulation 1215/2012 applies. Independently of that provision, Maltese public policy, which is rooted in EU law, constitutional principles, and the free movement of services, leads to the same result.
While EU infringement proceedings remain pending, the current judicial approach offers clarity and legal certainty for MGA-licensed operators operating cross-border from Malta.
About the Author
This article has been authored by Senior Advisor - Legal, Dr Simon Mangion.
