LeoVegas shows Dignity Decree defiance through EU complaint

As the Italian Lega-5Star coalition government moves to implement its ban on gambling advertising, forming part of its Dignity Decree, Stockholm-listed LeoVegas has submitted a formal complaint to the EU.

Leading the complaint, Niklas Lindahl, Leo Vegas’ Managing Director for Italy, remains “convinced” the Decree will be overturned, because introducing it on 1 January 2019, as planned, would breach the EU’s essential procedural requirements.

An integral part of the EU’s procedure, as mapped out in its Directive, is that when implementing a new bill, “Member States shall immediately communicate to the Commission any draft technical regulation” – a necessary process that LeoVegas believes was infringed upon.

LeoVegas, who have conducted positive meetings with MEPs from Sweden, Italy and Malta – all of whom share the firm’s opinion on the unlawfulness of the implementation of the Dignity Decree, with the operator vehemently affirming its position that this notification procedure was not met.

The EU requirements go on to outline: “Member States shall communicate the draft technical regulation again to the Commission under the conditions set out in the first and second subparagraphs of this paragraph if they make changes to the draft that have the effect of significantly altering its scope, shortening the timetable originally envisaged for implementation, adding specifications or requirements, or making the latter more restrictive.”

Identifying how the Decree is contradictory to EU principals, LeoVegas argues that a total ban on internal marketing severely hinders market access, and will therefore significantly restrict the incentive of operators from other EU states to enter the the Italian market because growth will be limited immensely due to lack of marketing capabilities.

The long term implications of the Decree are also a key element as to why it’s contradictory to the overall principles of the EU, as it’s deeply damaging to the free market, having a greater impact on new entries to the country’s online gambling space.

Within the Italian market, 10 established operators hold a market share of 60%, a figure expected to rise if emerging operators have no marketing presence to utilise. This would also decrease fairness in the market for consumers as the competition and incentive for others to enter the market would be heavily diluted.

Lindahl has confirmed to SBC that LeoVegas will put pressure on with a second and third formal complaint to the EU, driven by an ambition to completely overturn the bill within 6-12 months.