Dutch iGaming Refund Debate Exposes Europe’s Gray Market Problem

For years, there have been cases in the Netherlands of players demanding refunds for losses they had at unregulated gambling sites. Before the Dutch authorities opened their gambling market to private companies, these platforms were operating in the Netherlands in the gray market. That is, they held licenses, only not local Dutch ones – as there were no Dutch iGaming licenses at the time. In other words, the gambling activities were not legal, and since Holland launched an official gambling market, many of those very players turned to the authorities asking for rebates on their losses.

Here is where matters take a turn for the strange. While most courts shut down the cases, as these were unlicensed operators, unlawful games, and the players took part in gambling outside the frames of the law – some courts agreed with the players. The operators had to pay back the losses to gamers. This inconsistency, and the seemingly blurry extent to which authorities can protect players, even when they take part in locally unregulated gambling, puts a very intriguing spin on how the law accounts for unlawful gambling.

The Netherlands iGaming Sector

The Netherlands formally opened its online gambling market in October 2021, with the introduction of the Remote Gambling Act. The Dutch Gambling Authority, Kansspelautoriteit (KSA), is responsible for issuing iGaming licenses and governing the market. It can issue licenses for remote casino games, peer casino gaming products, sports betting operators, horse race betting and harness race betting. Also, the KSA set up a nationwide self exclusion register, Cruks, which all licensed operators must use.

It is like GamStop in the UK, where all licensed UKGC gambling sites must check to see if any newly joining members have self excluded or are suspended from gambling. The Netherlands actually has some of the most player protective laws out there, even limited the gambling advertising to players aged under 24 years old. All compliant, licensed Dutch gambling sites have to follow these rules. And any sites that don’t have Dutch licenses are effectively regarded as part of the illegal black market.

Dutch Supreme Court Verdict on Pre-2021 Gambling

So that is why it is strange that some Dutch courts, when reviewing these retrospective cases of players at the supposedly illegal gambling sites, have sided with the players. In these cases, the judges argued that while not recognized by local law, these contracts between players and unregulated gambling sites were deemed legally binding. The Dutch Advocate General advised the Supreme Court not to invalidate these contracts automatically. The Supreme Court released a statement at the end of November concluding that gambling contracts entered into online without a license are not invalid for that reason.

The contracts would be upheld in the courts of law, but that is not the end of the story. The Advocate General went on to state:

“the Betting and Gaming Act (Wok) never intended to affect the civil law validity of gambling agreements. The Advocate General sees no basis for reimbursing incurred losses based on undue payment, despite the fact that these gambling agreements were entered into without a local license”

Essentially, if you gambled at an illegal online casino, then the contract – while not officially sanctioned – is recognized as a civil gambling agreement, like a social gambling pact. However, the Advocate General stated that the repayments would have no basis, as these are “undue payments” or not legally recognized transactions between players and operators. It finished by stating that this is just an independent legal opinion, and that the Supreme Court is not bound to execute the Advocate General’s legal reasoning.

A ruling is expected to come from the Supreme Court in the first quarter of 2026.

Are the Player Claims Rightful

These lawsuits are far from straightforward, as they come with many ethical paradoxes. The question here is whether or not players are entitled to protection after engaging in illegal activities. Defending the players, in this case, can reward unlawful behaviour and set a very dangerous precedent, undermining regulatory authority. However, there are pros here for the Dutch authorities to side with the players and target the unlicensed operators. They can deter unregulated operators from catering to Dutch players in the future.

Why Side with the Players

Licensed in the Netherlands or not, all online casinos tend to be the stronger parties in gambling contracts. You aren’t entering a level playing field, there is always a house edge that favors the casino. They need to have an edge to stay in business, and that is why you get commission in baccarat, 35:1 payouts in roulette instead of 36:1, and the fundamental rules of blackjack give the dealer a slight edge. Players know these risks, and enter the games with betting strategies or staking plans to make the most of their bankroll, in the hope that some good luck comes their way.

So the player is the underdog here, and the authority would far rather back the players than the unlicensed operators who broke the laws by taking on Dutch gamers. The operators have a responsibility to offer their services in jurisdictions where they are legally allowed to. Many of the Dutch unregulated gambling sites held licenses in Curacao or Malta. These licenses, while highly respected around the world, are not officially recognized in Holland.

Ordering the operators to pay back players can also win player confidence. The authorities are fair, protect the interests of players, and want to clean up the Dutch iGaming scene with just rulings that gamers can count on.

Arguments Against Players

But the operators were not the only ones breaking the laws. A lot of the court cases shut down the gamers’ arguments, citing they acknowledged they were participating in illegal activities, and the gamers were held accountable for their actions. Claiming refunds from black market operators could set a highly dangerous precedent for gamers. While these are all retrospective cases (prior to 2021), who is to say if a player won’t gamble today at an unregulated site, and then come back a year later, citing the court cases today as their precedent to recoup their losses.

It could give players a reason to gamble at illegal sites, undermining the authorities and destabilizing the official gambling operators in the Netherlands.

Similar Cases in Other Countries

The Netherlands is not alone in this position. There have been similar cases across Europe, with players seeking to gain compensation from unregulated operators via official channels. These are mostly in jurisdictions that have either recently liberalized their gambling markets, or gambling monopolies that are nearing their end, like Austria’s gambling monopoly or Finland’s Veikkaus state run monopoly.

In Germany, which legalized its gambling market just before the Netherlands, in July 2021, there were several regional courts that also ordered operators to refund players. Prior to their Interstate Treaty on Gambling, the contracts players entered with unlicensed gambling sites were deemed void – meaning players were entitled to compensation for their losses playing slots, table games, or whatever games they took part in. However, some German courts argued the players took part in illegal gambling activities knowingly, and thus they were held accountable for their losses.

Austria, one of the most hostile jurisdictions for gray market iGaming operators, ordered international operators to repay millions of euros to Austrian gamers. Sweden, on the other hand, shut down most of these refund court cases. They deemed that players are not entitled to retroactive compensation, with a similar legal reasoning to the Dutch Advocate General.

Europe’s Plight Against the Gray Market

Many gambling reforms have been introduced in 2025, with more set to come in 2026. But Europe’s gambling regulators are trying to walk the line between cleaning up their gambling markets without going too far, and pushing players towards unlicensed offshore operators. For instance, in Spain they have rolled out compulsory anti gambling disclaimers, set strict deposit limits, and are experimenting with an AI deposit monitoring system to help detect risky behaviors. Another big player, Italy, is in the middle of a drastic licensing reform, which saw the number of betting sites reduce from over 400 to over 50.

Central to the onshore channelization efforts, the European Gaming and Betting Association represents some of Europe’s largest operators. They host seminars to explore the dangers of gambling harms, foster open dialogue between operators and gambling regulators, and the EGBA is also key to promoting cross-border alliances. The initiatives help standardize the regulators’ decisions, and work together to combat the black market. And those regulators are slowly realizing a shared truth: a strong onshore market is not built on enforcement alone. It requires competitive legal offerings, clear consumer trust, effective cross-border cooperation, and proportionate regulation.

In this case, with retroactive compensation, the Netherlands is not just setting a precedent for itself. It could also be a pivotal gesture that could impact every country within Europe.