Italy has formally replied to the detailed opinion released by Malta on the draft of technical rules for the next remote gambling tender, which was presented, in compliance with EU Directive no. 1535/2015, to the EU Commission and the EU member states in July.
The tender process for the assignment of the new remote gambling concessions is expected to be launched in Italy by the gambling regulator ADM before year end. Legislative Decree no. 41/2024 sets forth a remote gambling concession fee of €7,000,000 per concession and gambling website for a nine-year period of validity, not renewable. It also imposes a stringent set of further requirements, such as: the holding of (i) a gambling experience, minimum revenues, financial and moral stability; (ii) an architectural-technical capacity within the EEA and minimum requirements on environment, IT innovation, and cybersecurity; (iii) the holding of quality system certifications on company social responsibility, security systems, and responsible gambling; (iv) the compulsory investment of 0.2% of its net revenues, up to €1 million per year, for informative campaigns on responsible gambling and topics decided by an intergovernmental committee; etc.
As a result, the current number of concessionaires (more than 80 presently) is expected to decrease by about half.
To be noted, the above tender provision came as a bitter surprise, considering that the last tender, which took place in 2018, was for a total number of new remote gambling concessions of up to 120 with a one-off fee of €200,000 valid until 31 December 2022, all further extended for additional 2 years with a yearly average license fee of approximately €40,000.
To put things into context, a first attempt to drastically revise the remote gambling tender rules and reduce the market to “big players” only already occurred with the Budget Law for 2020, which was supposed to reduce the number of remote gambling concessions to a maximum of 40, with a minimum bidding price at €2.5 million each, valid for nine years. This tender procedure, expected in 2020, was never issued, following complaints from both the national and European remote gambling associations, LOGiCO and EGBA.
Today, Italy is denying any inconsistency with the EU laws and principles that Malta raised in its detailed opinion about the drafted technical rules of the next remote gambling tender. In regard, two major points raised our attention.
The first is Malta claims that B2B operators would be obliged, according to the draft of technical rules, to take a remote gambling concession in Italy as a condition to continue their offering of services to the remote gambling concessionaires in Italy. As of now, ADM denies having introduced a new regulation model for the B2B operators with respect to the existing one.
It must be pointed out, instead, that a specific regulatory framework recognising the role and the relevance of the B2B operators, as it exists in the UK or other EU remote gambling markets, could have benefited both the providers and the concessionaires, as well as provided more clarity on the existing remote-gambling supply chain beyond the concessionaire offer.
The second relevant issue is Malta claiming the breach of the technological neutrality principle between apps and website for the concessionaire’s remote gambling offer, since the latter is limited to one website only, while it can run as many apps as it wants capped to the number of gambling vertical it offers. According to such principle, an operator should be allowed to choose the technology considered most appropriate for its business purposes.
While ADM states that the platform and system requirements set by the drafted technical rules are the same both for the website and apps, it avoids providing the reason why a great number of apps will be allowed to the concessionaire (one for each gambling vertical) compared to the possibility of having one website only.
With the ADM reply to the Maltese detailed opinion denying any EU violation and the stand-still term approaching (18 November 2024), it could be considered that we are one step closer to the tender publication.
Procedurally, ADM still needs to receive the Council of State green-light on the tender draft of administrative rules in order to publish the tender notice in the Official Journal.
But most importantly, the above-mentioned open points, as well as the restrictive requirements set forth by the primary law provision on remote gambling, leave a great uncertainty on the concrete timing for the tender’s publication and on the lack of any Court challenge.
