Italy’s proposed sky-high licence fees spark concerns

The European Gaming and Betting Association (EGBA) has expressed concern over Italy’s decree on online gaming. The proposed legislation, featuring sky-high licence fees, is raising eyebrows not only for its financial burden but also for potential violations of EU law.

Unprecedented licence fee hike

The legislative decree was approved on December 19 aimed at reorganising the country’s gaming sector, with a primary focus on online gaming. It follows Article 15 of law 9 August 2023, n. 111, which is set to bring about a comprehensive transformation in the gaming regulatory landscape in Italy. The proposed unprecedented €7 million licence fee sets a new record among EU Member States. EGBA contends that such a substantial increase, a staggering 35-fold surge from the 2018 fee of €200,000, is unjustified, especially in comparison to the country’s previous licensing tenders. The proposed fee triples the earlier unimplemented suggestion of €2.5 million, raising questions about its rationale and potential consequences.

Alarming consequences and black market concerns

emphasized that the proposed licence fee surge will not only will discourage new entrants, but is also likely to drive existing, especially smaller, operators out of the market. The association predicts a drastic reduction in licenced operators from the current 91 to a mere 15-20, contributing to a significant expansion of Italy’s already substantial online gaming black market, posing heightened risks for player protection. Italy’s online gaming black market is currently valued at over €1 billion annually, and EGBA asserts that the proposed fee will exacerbate the situation, rather than rectify it, with profound implications for the safeguarding of Italian players.

“The proposed increase in licencing fees is unparalleled and unheard of, it would make Italy the most expensive country in Europe to obtain an online gambling licence. Together with the other restrictions in its gambling market, such as the local advertising ban, this proposed fee hike will make Italy a closed shop for new market entrants and lead to an exodus of existing licensees. This also raises concerns on compliance with EU law. We urge the Council of Ministers to reconsider the proposal, as it will make the country’s online gambling black market problem even worse, not better.”Maarten Haijer, Secretary General of EGBA

Revenue projections and alternative solutions

Anticipated revenues from the proposed licences, even under the most optimistic scenario, range between €105-140 million for the Italian state. EGBA suggested that reverting to the previously unused tender proposal of €2.5 million, without the previously suggested limitations, could yield similar or higher tax revenue without significantly undermining market competitiveness.

Urgent call for reconsideration

In its statement, EGBA called upon the Council of Ministers to reassess the proposed increase in licence fees. The association argued that by limiting competition to only a handful of operators, the proposal inadvertently strengthens the black market, risking a decline in player protection and market fairness.

Commitment to collaboration

EGBA expressed its commitment to collaborating with Italian authorities to develop a licence fee framework that supports a well-regulated and sustainable online gaming market. The association also suggested lifting the existing advertising ban, currently exploited by black market operators, to facilitate regulated advertising that protects minors and vulnerable groups while enabling licenced operators to market their regulated gaming offer.

About EGBA

The European Gaming and Betting Association (EGBA) is a Brussels-based trade association representing the leading online gaming operators established, licenced, and regulated within the EU. EGBA’s members include bet365, Betsson Group, Entain, Flutter, Kindred Group, and 888 William Hill, while Aircash is an associate member.

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