Date: 30.10.2024

by Sebastian Warowny

Malta Raises Concerns Over Italy’s Proposed Online Gambling Regulations

Malta has prompted the European Commission to extend the review period for Italy’s proposed online gambling reforms until November 18. The extension aims to address Malta’s concerns regarding technical and compliance requirements that could affect B2B operators within the European Union.

Malta Calls for Mutual Recognition of Licences

The Malta Gaming Authority (MGA) has criticized Italy’s planned technical and compliance mandates for B2B businesses, arguing that they could create unnecessary barriers. According to the MGA, these requirements might duplicate existing regulations for system and platform suppliers, making it more cumbersome for them to operate across different EU member states.

Emphasizing the need for a cooperative approach, the MGA stated: “Member States should recognise that B2B operators may already hold licences in other Member States and may be subject to myriad requirements and checks, which could easily be mutually recognised if a cooperation framework is set up for this purpose.”

Malta urges Italy to justify the additional technical demands to prevent potential obstacles to the free movement of services within the internal market.

Malta warns that the proposed Italian system could hinder both the freedom of establishment and the provision of services across the EU. By imposing extra technical requirements without mutual recognition, Italy might inadvertently create trade barriers that conflict with EU principles.

Italy Stands Firm on Steep Licensing Fees and New Compliance Measures

The Italian treasury is set to respond to Malta’s detailed opinion, with expectations that it will uphold the proposed requirements. Italian authorities believe that the new regulations are necessary to adapt to a market increasingly dominated by major multinational operators.

Under the new framework, Italy’s customs and monopolies agency (ADM) will continue to regulate online gambling. Operators seeking nine-year licenses will face a substantial fee increase, with costs rising from €200,000 to €7 million. Additionally, there will be a 3 percent levy on gross gaming revenue (GGR).

The Ministry of Finance justifies the escalated license fees by highlighting significant changes in the gambling market’s landscape. Despite the higher costs, the ADM anticipates that around 50 operators will apply for new licenses, reflecting sustained interest in Italy’s online gambling sector.

Operators will be required to base their IT infrastructure, including cloud services, within the European Economic Area (EEA). Compliance with EU data protection laws and secure communication with the state IT provider Sogei are also mandated. These measures aim to enhance security and regulatory oversight.

Regulations on Self-Exclusion and Platform Use

Compliance with self-exclusion tools is compulsory under the new rules, ensuring responsible gambling practices. While affiliated online websites, or “skins,” will be banned, operators are permitted to offer separate apps for different gaming verticals such as betting, casino games, poker, and bingo.

The proposed online gambling regulations will be incorporated into Italy’s Decree on the Reorganisation of Gambling. This broader legislative effort also addresses reforms in the land-based gaming sector, which have been progressing slowly.

To accommodate the delays in implementing the new framework, existing licenses will be extended until the end of next year. This extension ensures that current operators can continue their activities without disruption while the legislative process unfolds.