EU Court Advocate General: Offshore Operator Bankruptcy Doesn’t Block Account Freeze

^{Pictured: Rimvydas Norkus, Advocate General at the Court of Justice of the European Union}

Rimvydas Norkus, Advocate General* at the Court of Justice of the European Union (CJEU), said the bankruptcy of a gambling operator outside the European Union should not automatically prevent the freezing of its bank accounts within EU member states. He expressed the view while examining a dispute over the recovery of gambling losses by a player, according to Italian industry outlet Jamma.

The case stems from a dispute between a player from Germany and an offshore operator registered in Curaçao. A court in Frankfurt previously ordered the company to return about €57,000 that the player had lost on the operator’s website, ruling that the company lacked a licence to operate on the German market.

The player subsequently sought to enforce the judgment by asking a court to identify and freeze the operator’s bank accounts in Cyprus. The request relied on the European Account Preservation Order, a legal mechanism that allows creditors to temporarily block funds held in bank accounts across EU member states pending enforcement of a court decision.

During the proceedings, however, it emerged that bankruptcy proceedings had already been opened against the company in Curaçao. This raised the question of whether such proceedings could prevent the use of the EU account-freezing mechanism**.

According to Norkus, EU rules provide an exception only for insolvency proceedings opened within the European Union. If the procedure is initiated in a third country, it should not automatically prevent the freezing of accounts within the EU.

Curaçao, where the bankruptcy process was opened, is part of the Kingdom of the Netherlands but lies outside the European Union.

The Advocate General’s opinion is not binding. The final ruling in the case will be delivered by the Court of Justice of the European Union.

Earlier, Gambling Park reported that gambling regulators from seven EU countries had joined forces to combat offshore gambling.

* An independent legal adviser who prepares a formal opinion on a case before the court issues its ruling. The court is not obliged to follow the adviser’s position, though it often takes it into account when reaching its final judgment.

** In bankruptcy proceedings, a company’s accounts are typically not frozen at the request of individual creditors.