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Italian draft gaming law: a consumer breach?

The European Gaming & Betting Association (EGBA) lashes out at the Italian authorities due to newly proposed law that risks an increase in black market gambling

The European Gaming & Betting Association (EGBA) has contacted the Italian gaming authority, Agenzia Delle Dogane e Dei Monopoli (ADM), to let the European Commission aware that a new draft law targeting online casinos could potentially breach EU consumer protection rules.

It is expected that a new tender for a nine-year online gambling permit will be introduced from 2023 and would put a limit on the number of online gambling licensees. The number will decrease significantly as the present figure is at 120 while the newly proposed licensees will stand at 40.

While the licensees will decrease, the online licensing fees are set to increase - to at least €2.5m, a significant increase when comparing it to the previous amount. Licensing fees will also take on an auction structure rather than a fixed price, making it a completely different process from other European jurisdictions.

The EGBA released a statement on the matter:

“While EGBA appreciates the discretion, within certain boundaries, of Member States to set the cost for gambling licenses in their jurisdiction, this is an extremely high concession fee and, coupled with the drastic reduction of the number of online gambling licensees, would be a major barrier to a well-functioning market.

This could potentially also, EGBA believes, weaken the viability of the country’s regulated and licensed online gambling market, in favour of unlicensed operators who can easily be found online by players in Italy.”

The EGBA believes that Italy's Gaming Authority is obliged to forward these new proposals to the EU Commission under the requirements of the notification directive. This directive was put into place to ensure that all proposed national laws are in full compliance with EU law.

With this new limit of licensees & the hefty licensing fee, it is expected that there will be a massive rise in unlicensed operators within the area, meaning that players will no longer be safeguarded by the Italian consumer protection and gambling legislation.

Maarten Haijer, EGBA's secretary general also had a say on the potential situation & its effect:

Maarten Haijer

“We have asked the Italian authorities to duly notify the draft legislation to the European Commission.

Notification is required by European law, and failure to do so will render the law inapplicable to Italian-licensed companies and its citizens. The Commission’s careful scrutiny of this proposal is needed, also to make sure that the draft legislation will not be contrary to the consumer protection objectives of the Italian online gambling legislation.”

Italy's gaming landscape

This draft law may have a major impact on the Italian gaming industry, that up until now is doing extremely well. February saw Italy record its second best month ever due to a record online sports betting revenue, at a time were retail shops were closed due to Covid.

The ADM started issuing licences back in 2019 and those licenses that have been issued are valid till the end of 2022. Meanwhile, the Five Star Movement-Democratic Party coalition government was the first to propose reducing the number of licensees, with the initial number proposed to be around the 50 mark with fees costing €2m.

A close eye will be kept on Italy to see these developments regarding the licensees.

Source: EGBA

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