Italy’s proposed new fees for online gambling licenses have raised concerns among industry experts. The European Gaming and Betting Association (EGBA) has expressed its deep concern about the proposed decree, which includes significant changes to the sector, particularly regarding the cost of license fees.
The high fees could have severe consequences, deterring new market entrants and forcing existing licensees out of the market. The EGBA said this could lead to a drastic reduction in the number of licensed operators and an increase in the size of Italy’s online gambling black market, posing risks for player protection.
The proposed license fee for online gambling in Italy is set at an unprecedented €7 million, far surpassing fees in other EU Member States. This represents a 35-fold increase from the 2018 license fee of €200,000 and triples the Italian authorities’ previous proposal of €2.5 million, which was never implemented. EGBA believes that such a substantial increase is unwarranted, especially when compared to previous licensing tenders in the country.
The association predicts that the number of licensed operators could be reduced from the current 91 to as few as 15-20. This reduction in competition would contribute to the growth of the country’s online gambling black market, posing risks for player protection.
Italy already has one of Europe’s largest online gambling black markets, valued at over €1 billion annually. The proposed license fee hike is likely to exacerbate this problem rather than solve it. With fewer licensed operators, players may turn to unregulated and potentially unsafe platforms, putting their funds and personal information at risk. EGBA emphasizes that the primary goal of gambling regulation should be the protection of players and the fostering of a fair and competitive market environment.
While the Italian government anticipates revenues between €105-140 million from the proposed licenses, EGBA suggests that implementing the previously suggested license fee of €2.5 million, without limiting factors and an auction mechanism, could yield similar or higher tax revenue without significantly harming market competitiveness.
In addition to the license fee hike, EGBA highlights other regulatory considerations that could impact the online gambling market in Italy. The existing advertising ban, which is currently exploited by black market operators, should be revised to allow regulated advertising that protects minors and vulnerable groups. By enabling licensed operators to market their regulated gambling offers, the ban can help curb the growth of the black market while ensuring responsible advertising practices.
