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In Italy, the gambling market is currently operating under two sets of rules while awaiting the creation of a third by politicians. Industry experts at the SBC Summit in Lisbon revealed that there is unlikely to be any reform in the land-based sector before the next general election. A recent Council of State decision has further complicated matters by reshaping regulations for top-up outlets. With retail accounting for approximately three-quarters of a market valued at over €21 billion, the situation is significant, as reported by iGaming Business.
This dual rulebook scenario has left businesses navigating through legal rulings, evolving online regulations, and a retail network that has yet to undergo the promised overhaul. While there are no specific restrictions on esports betting as of now, the main concern for enthusiasts lies in the overall uncertainty surrounding licensed gambling operators in Italy.
A Decade of Reform Stuck in the Lobby
Efforts to reorganize Italy’s retail gambling network can be traced back to the 2016 Stability Law. Quirino Mancini, a co-founder and executive committee member of IMGL, pointed out that due to the political sensitivity of the gambling industry, it is unlikely that the government will address this issue before the upcoming election.
The division of responsibilities is clear: the central government would set the parameters for the network, such as size, density, opening hours, and proximity to sensitive locations, while regions and municipalities would handle implementation. The delay in reform is not due to logistical challenges but rather political hurdles. While online regulations are progressing with new rules set to be enforced on November 13, retail reform has yet to commence.
The Courts Get the Controller
A recent ruling by the Council of State focused on PVRs, establishments where players can add funds to their online gaming accounts. The court upheld a €100 weekly limit on cash and non-traceable top-ups, along with a prohibition on withdrawing funds at these outlets. However, the court rejected a complete ban on internet-connected devices in PVRs, deeming it disproportionate. This decision underscores the challenge faced when lawmakers do not provide clear guidelines, leaving judges to interpret operational procedures for operators, a common issue in gambling regulation.
The ambiguity is particularly challenging for companies that operate both online and retail businesses. Davide Diodato, CEO of HBG Online, which is owned by Novomatic, highlighted the discrepancy between the long-term online licenses and the yearly extensions for retail concessions. This annual uncertainty makes it difficult for small shop owners to plan investments or hiring strategies without clarity on the upcoming year’s regulations.
Big Operators Have the Upper Hand
The new online regulations pose a different challenge. Marco Castaldo, CEO of Microgame, described the current regime as hyper-regulated, noting that the top five operators control 85% of the market’s gross gaming revenue, a share that is expected to increase. Larger companies acquiring smaller rivals may benefit from this situation, while smaller operators may feel pressured to merge in order to compete effectively.
Furthermore, licensed operators are prohibited from advertising bonuses, while unregulated sites freely promote them on social media platforms, according to Fabio Bufalini, Stake Italy’s country director. This creates a challenging environment for regulated businesses, although the panel discussion did not portray retail as a dying sector. Instead, speakers envisioned retail outlets evolving into hubs for support, community engagement, and customer retention, complementing their online offerings.
This distinction is crucial for gaming audiences as a national gambling framework can influence betting options. However, the panel did not provide a definitive stance on esports betting in Italy. A comparison with France, where separate restrictions on esports betting exist, highlights the varying approaches taken by different countries, indicating that Italy may chart its own course in this regard.