Italy Gaming Reforms to Slash iGaming in Half

Changes in the Italian online casino sector are expected to reduce the total number of iGaming operators. Industry experts believe that this is intentional and would align with the government’s goal to streamline and consolidate the sector.

Italy Wants to Consolidate iGaming

Last month, Italy’s Customs and Monopolies Agency (ADM) concluded its tender process to award online gambling concessions. Although the body has yet to announce the winning bidders, the lower number of applications suggested a big reduction in the number of active operators.

For comparison, the previous tender saw 93 operators apply for a concession, whereas the most recent one attracted approximately 50 submissions. As a result, the number of iGaming operators could shrink to 33 from the current 81.

Experts weighed in on the matter, saying that this consolidation, which would completely change the balance of the iGaming market in Italy, would be in line with the government’s long-term goals.

The Country Tightened Its Requirements

So why are there fewer applicants than there were before? A major recent for the current over-saturation of Italian iGaming is that the local online casino sector was fairly easy to enter.

Lawmakers, however, are now seeking to change that. As a result, the ADM has changed its policy, introducing several new measures, including an upfront licensing fee of EUR 7 million (previously EUR 250K). It is for this reason that many smaller companies have decided not to pursue a concession, allowing Italy to streamline its gaming market.

By streamlining the market, Italy will ensure that its growing iGaming sector is in the hands of stronger and more financially stable entities with better technology and higher standards.

In addition to the upfront fee, sportsbooks and online casinos will be required to pay a gross gaming revenue tax of 24.5% and 25.5% respectively. Additionally, operators will have to pay an annual fee equivalent to 3% of their gross gaming revenue.

To top it all off, the new rules state that at least 0.2% of companies’ GGR (to a maximum of EUR 1 million) must be spent on responsible gambling initiatives.

The New Rules Envision Stricter Player Protections

In the meantime, the government is also planning to raise its AML and player protection expectations. Among other things, the overall regulations will be aligned with the digital age, which would include stricter requirements for protecting players from harm and allowing them to moderate their playtime. To that end, operators will be required to offer opportunities for customers to set deposit, spend and time limits or to exclude themselves from gambling.

Additional player protection protocols will seek to prevent harm among vulnerable groups, such as young adults.

In the meantime, lawmakers are also considering changes to Italy’s brick-and-mortar sector, which is likewise in need of reforms. While the government has recognized the need to change its approach to retail licenses, identification checks and player protection, hurdles with regional authorities have caused lawmakers to postpone their plans.