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With the upcoming tender for new Italian online gaming licenses, I have decided to publish some FAQs on the regime applicable to Italian online betting and gaming licenses.
The Italian Gaming Authority will award new online gaming licenses through a tender that is expected to be launched by November 2024 and is expected to last 60 days. This is an important deadline, as a new tender for licenses may not take place for several years.
Below is an outline of the requirements that are likely to apply to these licenses, based on the current regime and the legislation establishing the new licensing regime. Minor changes may occur as a result of the publication of the Gaming Licensing Rules:
Q. Why do I need an Italian gaming license to enter the Italian market? My company already has a foreign license, what are the advantages of an Italian license?
Offering games to people located in Italy without an Italian online gaming license is subject to criminal sanctions and tax penalties. In addition, access from Italy to domain names of unlicensed sites will be blocked by ISPs, and the new licensing regime includes measures to block payments to unlicensed sites.
Q. Is it necessary for my company to be incorporated in Italy or for the servers to be located in Italy in order to apply for an Italian license?
No, companies, their technical infrastructure and personnel can be located in any country of the European Economic Area. On the contrary, it will not be possible to locate the company and the infrastructure in non-EU countries such as the United Kingdom, Gibraltar, Alderney and the Isle of Man.
The possibility of locating the company holding the license abroad will result in significant tax savings, as the operator will only have to pay Italian gaming taxes, while not having to pay Italian corporate taxes. However, if the licensee has personnel, servers or points of sale for PVRs in Italy, the Italian tax authorities may question the existence of a permanent establishment for tax purposes. As such, the determination of the proper establishment in Italy is critical.
Q. Okay, can I apply for an online gaming license NOW? How much will it cost?
The tender for new Italian licenses is expected to be launched by November 2024. There will be an unlimited number of licenses available at a fixed price of EUR 7 million for a nine-year license. The application window is expected to last only 60 days and there is no indication as to when the new tender will take place. Therefore, companies should start preparing now.
Q. I would like to apply for a casino license and a sports betting license, what is the price?
There is no separate license for casino, sports betting or poker. Companies applying for an Italian remote gaming license will be granted an “umbrella” license covering all regulated games that are not subject to exclusive licenses. The offer is then subject to a technical approval process, which varies depending on the type of game.
Licenses will be granted to any company that meets the eligibility requirements, applies within the application window and pays the one-off license fee of €7 million.
Q. My Italian gaming license expires at the end of December 2024, what should I do?
The licenses of all online gaming operators will expire at the end of 2024. Therefore, all operators in the market must apply for a new license if they wish to continue operating in Italy.
Q. Okay, why should I enter the Italian gaming market?
Italy is the second largest gaming market in Europe after the United Kingdom. The full liberalization of sports betting and the new sports betting regulations complete the full offering of the Italian gaming market, which already includes casino games (including slots), poker, bingo, betting exchange, horse betting and betting on virtual events. In addition, the opportunities offered by eSports and fantasy games make the market even more attractive.
Q. But how can I market my offer with the Italian ban on gambling advertising?
As recent major sponsorship deals have shown, the Italian gambling advertising regime still allows for solutions that are considered compliant. It is necessary to adapt the offer to the specificities of the Italian gaming market.
Q. Let’s talk about technical issues, I have heard that operators will have to comply with strict technical requirements.
This is true, but the problem can be overcome by relying on the platform and services already approved by the regulator. Also, the technical approval process required by the ADM has now become much smoother, with fewer requirements in terms of technical documentation to be submitted to the regulator.
Q. Last question: What taxes are applicable to Italian remote gaming licenses?
The applicable tax regime is 25% of GGR for casino games and 24% of GGR for sports betting. In addition to these amounts, the new Italian online gaming licensing regime provides for the payment of a license fee set at 3% of the licensed operator’s net margin, calculated by deducting gaming taxes from GGR; and the operator’s obligation to invest an amount equal to 0.2% of its net revenues, but not exceeding 1,000,000 Euro per year, in information campaigns or responsible communication initiatives on topics to be determined annually by a government commission.
On the same topic, it is possible to read the article “Italian Lotto: The most valuable license tender of the year gets closer to its launch“.
