Under Italian law, gaming is divided into two categories: (i) "prohibited games" such as poker, chemin de fer, roulette (which can be organized only in Italian casinos – in Venice, Saint Vincent, San Remo, Campione d'Italia, each licensed by a specific law); and (ii) "licensable games" (betting, lottery, bingo). "Licensable" games fall within the State's monopoly.
Licensable games may only be organized by operators having secured a license by the Italian Monopolies Authority. "Unauthorized" gaming operators are subject to criminal liability and administrative fines.
This legal framework is clearly obsolete (and simply not really functioning) with respect to online gaming, since non-Italian operators can (and do) provide gaming and betting services to Italian residents, but without any physical connection with the Italian territory.
Since gaming and betting is a fundamental source of revenue for the Italian State, the Italian government has increasingly tried to stifle online gaming, fearing the loss of revenue deriving from the shifting of players from traditional physical games to online games. At the same time, the Italian State incited and encouraged consumers to participate in lotteries, games of chance and betting.
As part of the Italian campaign against unauthorized betting, proceedings begun against several Italian residents who, by collecting bets for an English operator (not established in Italy), were said to be "aiding" an "unauthorized" operator.
This culminated in the European Court of Justice 2003 Gambelli decision, which clarifies the EU law framework for a member State to prevent the offer in its territory, by other EU gaming operators, of betting and gaming services. In brief, the Gambelli decision confirms that loss of revenue is not a valid reason, under the EC Treaty, to restrict the freedom to provide services (including betting and gaming services) and the freedom of establishment. The European Court of Justice also confirmed that the only valid reasons to prevent other EU operators from providing betting services are those "justified by imperative requirements in the general interest , such as consumer protection, prevention of fraud and incitement to squander on gaming". In any case, added the court, any restriction of freedom to provide betting and gaming services must not go beyond what is necessary to attain the end in view.
The Gambelli decision was not automatically applied by Italian courts. In 2004, the Italian "Corte di Cassazione", regardless of the findings and the guidelines of the Gambelli decision, argued that Italian restrictions on gaming are justified by public order reasons and conform to EC Treaty. Lower courts, instead, in many cases have issued decisions stating the exact contrary of the "Corte di Cassazione": Italian regulations on gaming (in particular with respect to the restrictions on EU betting providers) conflict with the EC treaty and, as a consequence, are not enforceable in Italy.
As a further attempt to block foreign betting providers (including EU ones) the Italian Budget Law for 2006 now requires Italian "network services" providers to block access to "unauthorized" gaming operators.
This shows that the Italian Government, notwithstanding the Gambelli decision, intends to continues its battle against online betting and gaming, while promoting new gaming opportunities (the Italian Monopolies Authority announced fourteen new bet for the Italian Sanremo music festival!).
Further, on February 13, 2006 the Italian Monopolies Authority, pursuant to the Italian Budget Law for 2006, has adopted a black-list of "unauthorized gaming operators". Pursuant to the Budget Law for 2006 and to implementing regulation adopted by the Italian Monopolies Authority, Italian internet service providers have been called to block access to the blacklisted websites as of 00:00 a.m. of February 24, 2006.
Incidentally, while the current black lists includes only websites, the "black list" principles may extend in the future to other "networks." In other words, a TV channel on betting broadcast from an EU country into Italy may end up being subject to the same principles and being "blacklisted."
At present, it appears that most of the Italian internet service providers are already complying with the obligation to block access to the blacklisted websites. If navigating on one of the blacklisted websites (with one of the complying internet service providers) a page indicating that the access is blocked pursuant to a resolution of the Italian Monopolies Authority.
Should the network providers fail to implement measures to block access to unauthorized operators, the Italian State Monopolies may apply a fine from Euro30.000 to Euro 180.000 for each breach.
The resolution, the black list, and a press release from the Italian State Monopolies are available in Italian at www.aams.it.
While an in-depth review of the relevant legislation and regulation is necessary, it may be noted at this point that, in the Italian Monopolies Authority's resolution, the revenue-conservation purpose of the blacklist is clear. The second Whereas before the last, in fact, states that "the collection of games and bets not subject to Italian law is forbidden in Italy and that such [unauthorized] collection produces lower revenues for the [Italian] State." As known (and as stated in the ECJ Gambelli case), the loss of fiscal revenues generated by State-run gaming should not be a valid exception to the EU freedoms.
Most likely, therefore, the relevant provisions of the Italian Budget Law for 2006, of the Italian State Monopolies resolution and the creation of a "black list" of unauthorized gaming operators could be challenged before Italian courts and at the EU-level, on EU law grounds, to allow operators satisfying certain requirements to offer their services into Italy.
Similarly, such provisions of the Italian Budget Law for 2006 could possibly be challenged on domestic constitutional law principles, in that they may end up creating a "reverse discrimination" and undue burdens on Italian internet providers and possibly including restrictions on freedom of speech.
The content of this aticle is intended to provide a general guide to the subject matter. Specialist adivce should be sought in your specific circumstances.