OGH on Official and State Liability for Illegal Online Gambling

Nov 29, 2024 Benn-Ibler Rechtsanwälte

An unlawful and culpable act of an official body in the execution of the law, which obliges the legal entity to pay compensation pursuant to Section 1 of the Official Liability Act (Amtshaftungsgesetz, hereinafter AHG), can also be an omission if the body had a duty to act and dutiful action would have prevented the occurrence of the damage.

Between 1 October and 2 November 2019, the plaintiff participated in illegal online gambling and suffered losses as a result. The gaming operator was not licensed under Austrian gaming law.

The plaintiff sought to recover EUR 30,150 from the defendant (the Republic of Austria) based on official and state liability.

The lower courts dismissed the action. It was held that, in the absence of a special relationship between the injured party and the legal entity, no state liability claims could be derived from the protective provisions of Section 3 of the Austrian Gaming Act (Glücksspielgesetz, hereinafter GSpG). The Austrian Supreme Court (Oberster Gerichtshof, hereinafter OGH) confirmed this decision.

In the event of a claim for damages against the legal entity, the legal entity shall be liable for the unlawful and culpable conduct of its organs only if the breached standard of conduct was intended to prevent the damage that occurred in accordance with its protective purpose.

The Federal State does not have any obligations under the GSpG which require it to take action or to refrain from taking action which are directly aimed at ensuring that players (whether addicted or not) do not suffer any damage as a result of illegal gambling. Rather, the organs of the defendant are exclusively responsible for the notification of illegal providers and the punishment of violations of the gaming monopoly (under administrative criminal law).

The OGH also denied the state liability of the defendant legal person. State liability of Member States for breaches of EU law is subject to three conditions: Firstly, the breach must be intended to confer rights on individuals; secondly, the breach must be sufficiently serious; and thirdly, there must be a causal link between the damage suffered and the breach for which the Member State is responsible. A possible violation of EU law is therefore not causal for the damage alleged by the plaintiff.

OGH 1 Ob 77/24s (25 September 2024)