Gambling in Italy is closely associated with the ancient heritage of the Roman Empire. The country takes pride in being the home of the world’s oldest land-based casino Ridotto that opened its doors as far back as 1638. The gambling house is considered to be the predecessor of modern casinos. Even though Ridotto was open to the public, only the Italian nobility could enjoy its gambling services due to the high stakes and strict dress code.
Interestingly enough, the word “casino” stems from the Italian word “casa” which means house. Gambling in Italy has been legal ever since the 1900s, but the law that governs the industry was amended on several occasions. Currently, the country is believed to have one of the most adequate gambling frameworks within the European Union, serving as a role model to countries that are eyeing the opportunity to relax their gambling laws.
Legal Forms of Gambling in Italy
Under the Italian criminal law, gambling is an illegal activity and the organization of gambling activities in public or private places is viewed as an unlawful act. In Italy, illegal gambling is defined as wagering real money on an uncertain outcome in a game of chance for the opportunity to win a prize. Following that stream of thoughts, the authorities make a difference between games of chance as opposed to games of skill.
What is the Size of the Italian Gambling Market?
When it comes to gambling, the Italian market is believed to be the second-largest in Europe, bringing an annual income of over €80 million to the country’s Treasury. Based on data published on statista.com, in 2015, Italian players wagered a total of €88.2 billion on online and offline gambling activities. The amount wagered in 2016 reached €96.1 billion. In 2017, the figures show that €101.75 billion were wagered in Italy.
In 2018, the wagered amount kept on increasing, reaching the staggering amount of €106.86 billion. The statistics further reveal that Italian players spent a total of €110.54 billion in 2019. In other words, the total amount wagered on all forms of gambling activities in Italy increased steadily by over €20 billion for the period from 2015 to 2019.
Want a License in Italy? Turn to the ADM
Amministrazione Autonoma dei Monopoli di Stato (AAMS) was renamed Agenzia delle Dogane e dei Monopoli (ADM) in 2012 under Decree Law No. 95. The agency is responsible for overseeing and controlling the gambling industry in Italy as well as issuing licenses to operators.
In addition to that, the agency can impose fines and suspend/revoke licenses. Among its main goals is to fight against illegal gambling activities and ensure a safe gambling environment. ADM is also tasked with collecting gaming taxes and protecting individuals from gambling-related problems.
Its other functions include administration of customs duties, management of customs services, management of the manufactured tobacco products sector, prevention of tax evasion, management of chemical laboratories, and promotion and participation in associations.
AAMS was established in July 1999 under the Legislative Decree No. 300 as one of the three tax agencies in Italy. Since 2012, the agency has legal status and regulatory, administrative, and financial autonomy. In April 2018, the Ministry of Economy and Finance thumbed up a drastic change of the agency’s functions and organizations, outlining its major missions as mentioned above.
With regard to gambling, the tax agency regulates the following forms of gambling:
- Terrestrial casinos
- Slot machines and video-lotteries
- Sports and horserace betting both online and offline
- Online and offline pool betting
- Online and offline bingo and lotteries
- Online poker and other card games
- Virtual and live betting
Requirements for Obtaining Gambling Permits in Italy
The Italian online gaming licensing regime is not the most straightforward. Casino operators that wish to legally operate on the Italian market need to obtain a license from ADM – the agency that monitors the gambling industry throughout the country. Prior to submitting documents to apply for a license, casino operators should meet certain requirements to be eligible for obtaining an Italian gambling license.
Under the Italian laws, the operators should have their servers placed in a country that is part of the European Economic Area (EEA). What is more, the operators need to present a bank guarantee of €1.5 million as security to ensure that they can pay out the winnings to their players.
Furthermore, the applicants need to hold a license issued in another European jurisdiction. The agency will also check the moral probity of the applicants to make sure that only reputable operators will have access to the lucrative Italian gambling market.
Licensing Application and Issuance Procedure
The Italian casino license is among the most sought-after documents on the market as it allows operators to provide all kinds of gambling services throughout the country. In addition to that, the gambling industry in Italy has witnessed steady growth over the past few years, adding further appeal to the market.
From casino games to sports betting, the Italian license covers all types of gambling activities. In other words, casino operators do not need to apply for several licenses to offer various gambling activities. It is important to explain that the expired licenses are not renewed automatically. In the lines below, our expert team will provide detailed information regarding the steps operators need to follow to apply for a license:
Steps operators need to follow to apply for a license
1ADM first launches a public tender
ADM first launches a public tender – such tenders are windows of time in which ADM allows operators to apply for casino licenses. Interested operators have to submit their applications to the ADM within 30 days after a tender is opened. Operators cannot apply for licenses once the application window closes.
Such tenders were launched in 2006, 2011, and 2018. Considering the last public tender, the agency opened applications for up to 120 online gaming licenses, but only 70 were issued. The price of each license was set at €200K.
2Submission of relevant documentation
Submission of relevant documentation – interested operators that want to obtain an Italian gambling license are required to prepare a set of documents that includes proof that the website is registered on an .it domain, notarized copies of the passports of all founders and shareholders, bank certificates proving the account opening, proof of financial sustainability, proof of the gambling software quality, platform and games description, and detailed business plan.
3Posting a €1.5 million bank guarantee
Posting a €1.5 million bank guarantee – this is a bank document that proves a given operator’s financial stability. It should be attached to the package of documents in support of the license application.
4Sending a technical certification
Sending a technical certification – the final step of the journey is to send a technical certification from a testing house to ensure the operator’s software is on par with ADM’s requirements. It is important to explain that each game category needs to be approved through a technical license following the certification of the platform.
5ADM publishes a list of approved operators
ADM publishes a list of approved operators – after the submission of the application, the agency will take 6 to 8 weeks to check the applications and publish a list of the approved operators. All licenses granted during the 2018 tender have a duration of 4 years and thus will expire on 31st December 2022.
Interested parties are advised to check additional details and updates regarding the procedure on ADM’s official website prior to submitting a license application.
Italy to Reduce the Number of Online Gambling Licenses
In 2019, the Italian government revealed its plans to cut down the number of online gaming licenses from 85 to 50. The new measures rules are expected to come into effect in 2023. The government also mulls over changing the price of the online gambling licenses to €2 million. In addition to that, the officials suggest prolonging the duration of the gambling licenses to 9 years.
The new public tender is expected to commence in 2021 or 2022. Operators who wish to set foot on Italian soil will be able to pay for their gambling licenses in two installments. The first one should be made within 30 days upon receiving the license and it should be at least 50% of the price. The second installment should be made within 30 days after the license is signed.
The government also considers limiting the number of slot machines to 250,000, to allow a maximum of 58,000 video lottery terminals, and up to 2,800 gaming halls to operate throughout the country. The new regime aims at curbing the constantly growing gambling addiction rates.
The Cost of Operating on the Italian Gambling Market
Obtaining an Italian casino license is not the most cost-effective endeavor, but it pays well considering the size of the Italian gambling market. Compared to other countries from the EU, the Italian gambling license is quite pricey.
Sanctions for Violation of the Licensing Conditions
Heavy fines will hit errant gambling operators after the Italian government has taken tougher measures against illegal gambling. Participants in illicit gambling operations will face a criminal sentence of up to 6 years. Furthermore, gambling companies that assist criminal operations will be hit with a hefty fine of €50,000, while betting retail shops or arcade venues that allow the operation of unauthorized gaming terminals will be slapped with a €20,000 penalty.
In the end, ADM has taken the right steps to prevent vulnerable individuals and children from gambling exposure. However, we cannot help but mention that the burdensome taxes may trigger an exodus of operators. We have witnessed similar scenarios of regulators imposing too steep taxes and the result is all the same – licensed and legitimate operators leaving the market.
Italy has always been considered a lucrative market due to the high demand for gambling services among locals. However, some industry insiders believe that the tax hike and the recently introduced turnover gambling tax may harm the currently proliferating Italian online gambling market.