Italy Sets New Course for Online Gambling Concessions

The government’s intervention to halt the ADM, Italy’s Customs and Monopolies Agency, from terminating licenses due to expire in 2023 and 2024 has paved the way for a comprehensive settlement. Under the new agreement, online gambling concessions will be renewed by the end of 2024, with each license capped at nine years and set at a steep €7m fee.

This rate is 35 times higher than the previous €200,000 fee established in 2018, reflecting the evolving dynamics and significant growth of Italy’s online gambling market.

Fee Hikes and New Conditions

While the Ministry of Finance (MEF) supports the increased fee as a reflection of the market’s growth, the online gambling trade body Logico criticizes the move as potentially harmful to competition. Logico argues that the hike is designed to reduce the number of operators in the market, a goal seemingly aligned with ADM’s preferences.

In addition to the fee increase, each license will incur an annual charge of 3% of the Gross Gaming Revenue (GGR) after taxes. License conditions will also limit operators to a single app per gambling product and one website per concessionaire, explicitly banning any affiliated ‘skins’ websites. The MEF anticipates that these changes will not only streamline the sector but also boost gambling income taxes by €350m over the next two years, with concession fees expected to generate an additional €100m annually.

The new framework introduces stringent technical requirements for gambling licenses, mandating customer-set playing limits and warning notifications for impending limit breaches. Furthermore, the ADM will receive enhanced powers to tackle unlicensed online gambling, including the authority to block payments.

In a related announcement, the government is set to initiate a tender for the operation of Italy’s Lotto Euro game, currently managed by IGT until November 2025. With a projected annual turnover of €7.7bn post-2025, Lotto Euro represents a lucrative opportunity, prompting a starting bid of €1bn for the tender.

Our Comment on the Article

The Italian government’s overhaul of the online gambling concession framework signals a significant shift towards tighter regulation and increased revenue generation. While the steep increase in licensing fees and stringent operational restrictions may pose challenges for smaller operators, these measures aim to foster a more controlled and transparent gambling environment. As the sector braces for these changes, it will be crucial to monitor their impact on market competition and innovation. The upcoming Lotto Euro tender further underscores the government’s commitment to reshaping Italy’s gambling landscape, promising a new era of regulatory clarity and financial prosperity.