Italy’s Online Gaming Faces Decimation with New Rules, Insiders Warn

Posted on: December 19, 2023, 06:42h. 

Last updated on: December 19, 2023, 10:50h.

Legislators and certain lobbyists in Italy are in the process of trying to rewrite online gambling legislation. The new policies could cause a mass exodus from the regulated segment, and gaming industry players are hoping to prevent that from happening.

The Temple of Saturn ruins in Italy
The Temple of Saturn ruins in Italy. Gaming industry insiders warn that the iGaming segment could face serious problems if the government moves ahead with new rules. (Image: Expedia)

In a meeting with Italian lawmakers last week, representatives from more than 10 gaming industry trade groups united to express their concerns. The Milton Friedman Italian Political-Economic Institute in Italy organized the gathering.

The group unanimously warned that the proposed changes, if implemented without careful consideration, could have detrimental consequences for the entire gaming sector. They’re confident that the changes, including a 35% price hike in the license cost, will lead to increased illegal activity, reduced consumer protection, and the stifling of small and medium-sized businesses.

Gambling: One Market, One Reorganization

Italy has reportedly been working on creating a unified policy that covers land-based and online gaming. However, some recent proposals don’t reflect parity between the two.

A central theme of the industry’s message was “Gambling: One Market, One Reorganization.” It expresses the need for a harmonized approach to online and land-based gambling regulations.

The current regulatory framework, the group argued, creates an uneven playing field. It favors the expansion of the illegal sector and undermines efforts to protect consumers.

One of the most contentious points raised by the industry was the proposed increase in the cost of an online gambling license. The proposed 35-fold hike, from €200,000 to €7 million (US$218,600 to $7.65 million), was deemed excessive and unjustifiable.

The industry warned that this dramatic increase would severely restrict the number of potential operators, potentially reducing the pool to just 20 from the current 91. This, in turn, could stifle competition, limit innovation. and ultimately, harm the overall health of the industry.

Beyond the economic impact, the industry group expressed deep concern that the proposed reforms would negatively impact public interest objectives. This includes negatively impacting consumer protection and responsible gambling programs.

The participants argued that addressing the reorganization of online gambling without addressing the land-based segment would create loopholes and opportunities for illegal operators to flourish. By failing to consider the entire gaming sector holistically, the Italian government risks exacerbating disparities, encouraging illegal activity, and hindering the growth and development of a responsible and regulated industry.

Solidarity in Gaming

The industry’s message resonates with ongoing concerns about Italy’s formal approach to gambling reform. In recent months, the government has been criticized for its piecemeal approach and lack of consultation with industry stakeholders.

The unified opposition from the legal gaming industry trade groups highlights the need for a more comprehensive and balanced strategy. The government, they say, must consider the interests of  operators and consumers, not just the desires of a small group of lobbyists, to develop a stable and viable market.

The group also emphasized the need for policymakers to heed the warnings of the legal gaming industry. They must adopt a thoughtful approach that prioritizes responsible gambling practices, protects consumers, and ensures a level playing field for all operators. By doing so, Italy can safeguard its economic vitality and foster responsible gambling practices.