Italy's ongoing struggle with retail gambling reform is now a matter for the courts, rather than lawmakers, as highlighted during the recent SBC Summit in Lisbon. On September 30, Quirino Mancini, co-founder and executive committee member of the International Masters of Gaming Law (IMGL), expressed concerns that there would be little government action on retail network reorganization before Italy's next general election. "I would struggle to imagine that, in the year before elections, any government, no matter the color, would seriously address the reorganization," he remarked, indicating the political sensitivity surrounding gambling issues.
The importance of this standstill cannot be understated; retail operations make up about three-quarters of Italy's gambling market, valued at over €21 billion. While the online segment is undergoing substantial regulatory changes beginning November 13, land-based gambling reform remains uninitiated. Mancini pointed out that the roots of this reform effort trace back a decade, stemming from the 2016 Stability Law.
According to him, while the technical aspects are largely settled—central government determines factors like network size and closures while local entities manage the execution—the political will to advance these reforms continues to be lacking.
The topic of the panel coincided with a recent ruling from the Council of State regarding Italy's top-up outlets, or PVRs, where players add funds to online gaming accounts. This ruling upheld the €100 weekly limit on cash top-ups and a ban on cash withdrawals at PVRs, while overturning a comprehensive ban on internet-connected devices in these locations as excessive.
"Wherever there is a vacuum in the legislative power, the judicial one steps in, and that becomes the regulation, which is never a good thing," Mancini commented, adding that judges often lack a comprehensive understanding of the gambling industry.
For operators managing both online and retail aspects, this inconsistency proves challenging. Davide Diodato, CEO of Novomatic-owned HBG Online, pointed to conflicting licensing structures: online licenses extend for nine years, while retail concessions are renewed annually. "You don’t fly aircraft with two flight plans and different information. But it’s actually what we have to do every day. So it’s pretty tough," he noted.
The uncertainty is particularly burdensome for small retail operators who face constant pressure regarding future regulations. "Every year, they ask us what’s going to happen next year," Diodato said. "If you put yourself in their shoes, it’s pretty hard to invest, to hire people."
Sisal managing director Marco Tiso indicated that retail gaming still operates under rules established two decades prior, labeling it a missed opportunity. He emphasized that players experience varying products, payouts, and promotions based on the platform utilized.
On the online front, Microgame CEO Marco Castaldo described Italy's regulatory landscape as an example of “hyper-regulation” with a daunting level of complexity that is likely to emerge in various regulated markets in the coming years. He highlighted a trend of increasing market consolidation, noting that the top five operators now account for 85% of market gross gaming revenue (GGR), a figure expected to rise further.
Fabio Bufalini, country director of Stake Italy, mentioned that licensed operators face obstacles in advertising bonuses while unregulated platforms operate freely on social media, creating an uneven playing field.
Participants in the discussion also agreed on the potential for online platforms to thrive, highlighting that penetration remains at only half to a third of several northern European markets. However, some experts suggested that the role of physical retail locations is evolving, rather than diminishing. Castaldo underscored the enduring appeal of in-person experiences and community interactions associated with gaming.
Tiso envisioned retail shops evolving from basic sales points to venues for assistance and social engagement, with the potential to draw new customers to casino-style offerings, provided regulatory processes facilitate innovation.
Interestingly, Tiso suggested a potential reversal in player migration trends, predicting that in the future, online platforms might drive customers back to retail locations for a comprehensive gaming experience missing from the digital space. Diodato noted that younger demographics are increasingly engaging with gaming through online platforms first rather than traditional retail outlets, indicating a possible transition in how retail functions within the broader ecosystem.
Even Bufalini from Stake Italy, which operates exclusively online, remarked that retail isn’t necessarily at odds with digital platforms. He stressed the need for a unified approach to the industry and its regulatory framework. Diodato added that retail has a unique connection to its local communities that cannot be replicated by the illegal sector, emphasizing this vital aspect of their operations.
