Malta and the European Commission have clashed over Amendment 56A to the "Gaming Law". In June, the EU issued a formal warning to Malta, stating that this provision prevents the recognition and enforcement of judgments made by courts in other EU member states against Maltese gaming operators, allegedly violating the principle of judicial mutual recognition.
Malta's Defense Reasons
Principle of Public Order (ordre public): Malta argues that this provision is merely a reaffirmation of the public order exception in existing EU law, allowing domestic courts to refuse enforcement when a foreign judgment violates Maltese public policy.
Principle of Freedom to Provide Services: Malta emphasizes that its gaming regulation follows the concept of freedom to provide services under "Article 56 TFEU", and that 56A is not an exemption but ensures that operators under its license can provide services across EU member states without foreign property interference.
Domestic Court Support: Law firms, including GTG Legal, believe that this provision philosophically confirms fundamental regulations rather than breaking EU legal boundaries.
EU's Points of Concern
Breach of Judicial Mutual Recognition: The EU is concerned that this provision may weaken the mutual recognition system of court judgments between member states, undermining the legal consistency of the single market.
Restriction on the Uniform Application of EU Law: The EU believes that the blocking of foreign judgments by 56A could lead to actual violations of TFEU principles.
Further Developments
Malta has received a "reasoned opinion" and may face litigation in the Court of Justice of the European Union (CJEU) if it fails to rectify the situation within the deadline.
Meanwhile, the Supreme Court of Austria has requested a preliminary ruling from the CJEU on the relationship between this provision and cross-border gambling compensation cases.
Summary and Outlook
Malta believes that Article 56A is not in conflict with EU law, legally protects its regulatory model as a "supplier country", and complies with the legal exemption of public order.
The EU, however, believes that this action may undermine legal unity and the mutual recognition system of courts, posing substantial infringement risks.
If the parties cannot negotiate a resolution, the matter will ultimately be decided by the CJEU, a process that could take several years, and its ruling will profoundly affect the EU's gambling regulatory framework.
Currently, Malta has a legal defense system, but whether its provisions can withstand the EU Court's consideration of legal uniformity remains an unknown.
