The European Gaming & Betting Association (EGBA) has issued a notification to the European Commission demanding that Italian authorities explain why they have published a draft law proposal seeking to reduce the number of online gambling licences by two-thirds.
A reduction of online gambling licences had been initially proposed by the former 5Star-DP coalition government, as a draft measure attached to Italy’s ‘2020 Budget Law‘.
However, the EGBA cites that Italian authorities have continued to work on the proposal, which aims to reduce the EU member state’s online gambling licences to 40 and further increase licensing fees to €2.5 million by 2023.
The Brussels-based trade association has stated that the Italian government must notify and disclose its draft proposal to the European Commission (EC) to ensure that its business mandate is compliant with EU laws on fair competition standards.
It said: “The tender proposal would reduce the country’s current limit of 120 online gambling licensees to 40, a significant reduction by two thirds, and seeks to increase licensing fees to at least €2.5 million, 10 times larger than the country’s previous licensing fees.”
The original proposal put forward by 5Star-DP coalition had been sanctioned following the overhaul of Italy’s Customs and Monopolies Agency (ADM) as the regulatory agency governing Italian gambling.
The ADM had been ordered to put forward a series of comprehensive reforms across gambling’s land-based and online sector, beginning with the restructuring Italian gambling’s licensing frameworks.
In its assessment of the proposal, the EGBA has underlined a number of conflicting areas such as licensing fees being determined ‘through an auction process rather than through a fixed licensing fee’ – as the common practice of EU member states.
The EGBA further cites that the proposed reduction would lead to a weakened viability of Italy’s gambling market, which would be exposed to black-market threats as players move to unlicensed operators.
“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,” said Maarten Haijer, EGBA Secretary-General.
“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.”
Taking office last March, Italian stakeholders hoped that new Prime Minister Mario Draghi would soften on the former coalition government’s tough stance on the gambling sector – which had witnessed three years of back-to-back tax increases and increased regulatory intervention.
However, Italy’s incumbents were left disappointed, as Draghi stated that his administration would not re-evaluate industry laws and taxes approved by the previous government.