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Thursday, January 28, 2010
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As anticipated, I attended this week the Legal Gaming in Europe Conference and the IGE. Since I have noticed that a number of operators were addressing me the same kind of questions and concerns about the Italian online gaming regime, I had the idea to publish some FAQs that might help operators to approach the Italian gaming market:
Q. - Why do I need an Italian gaming license to enter into the Italian gaming market? My company already holds a foreign gaming license, what are the benefits of an Italian gaming license?
Read this article on the topic "What are the benefits of an Italian Gaming License". 
Q. - Do I need that my company is established in Italy or that the servers are located in Italy to apply for an Italian gaming license?
No, under the draft decree introducing the new licensing regime the operator and its servers can be located in any country of the European Economic Area or in any other country that has entered into a bilateral agreement with the Italian Gaming Authority.
Q. - What is the turnover of the Italian gaming market?
On this page of the website of the Italian Gaming Authority you can have access to the monthly turnover (online and offline) of the Italian gaming market. Please note that the turnover concerning bingo has to be meant referred only to offline bingo since online bingo waw launched in January 2010. 
Q. - But I have heard that offline gaming terminals are very relevant in Italy for the online business, is it true?
This might be true under the old gaming license regime, but the new regime will prohibit such gaming terminals. Read this article on the topic "The Death of Gaming Totems. An Advantage for New Entrants?". 
Q. - Ok, can apply for a license NOW?
No, as you can see from this article "New Gaming License Regime Under the Review of the EU", the draft decree prescribiling the issue of the new gaming licenses is currently under the review of the European Commission. After the expiry of the so called "stand still" period, the Italian Gaming Authority will publish the decree and operators will be able to apply for new licenses.
Q. - So for the time being is there any possibility to enter into the Italian gaming market for a new operator?
Currently the only two open options are either the acquisition of a license (or of the entire company holding the license) from another operator or the management of the website under the license of another operator.
Q. - But I am not interested in this kind of deals, shall I just wait then?
No, this might be the right time to seek the acceptance of the Italian Gaming Authority of for instance new mechanics of games and to obtain their approval of the gaming platform to be ready to launch the website when the decree setting out the new licensing regime will be published. Indeed, technical issues might lead to relevant delays in the launch of the gaming platform. 
Q. - Let's speak about technical issues, I have heard that operators have to comply with stringent technical requirements.
This is true, but the problem can be overcome through agreements with other operators that allow licensees to use their platform which is already approved by the Italian Gaming Authority and therefore does not need to be tested and approved again by the Italian Gaming Authority.
Q. - Final question: Taxes
The gaming duty varies depending on the type of game involved. For instance in case of bingo it is 11% of the turnover, in case of cash games and casino games it will be 20% of the revenues, while in case of skill games (including online poker tournament) it is 3% of the turnover.
If you are intersted in entering into the Italian gaming market and you have additional questions, feel free to contact me, Giulio Coraggio
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Monday, January 25, 2010
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The introduction of a private copying levy scheme has been subject of relevant discussions during the last years between right holders and device manufacturers. Indeed, as far as Italy is concerned, the law implementing the EU Directive 2001/29/EC had already allowed in 2003 private copies of copyright protected works without the consent of the right holders and had also introduced a "fair compensation" scheme to refund right holders of the grant of such private copying rights. Indeed, according to the law, manufacturers of memories, DVDs, MP3 players etc. had to pay a specific amount per each product sold to the SIAE (the Association of Authors and Editors).
Despite the express provision in the law, the Italian Ministry of Cultural Goods has only now issued the decree which specifies the amount due in relation to each type of device and to which type of devices the private copy levy is applicable. This latter matter has been considerably criticized since the levy has been considered applicable also to mobile phones
In this respect, it is interesting to notice that only 4 EU Member States have extended so far the fair compensation scheme to mobile phones and the reason behind this is maybe that the primary purpose of mobile phones is certainly not the one of an MP3 player or of a memory stick and maybe the applicability of such regime to mobile phones risks to excessively penalize a market from which right holders do not suffer considerable damages.
Also, some mobile manufacturers believe that the Ministry did not have the legal powers to extend to mobile phones such regime since this category of products was not mentioned in the relative law. If you want to discuss the possibilities to challenge this decree, feel free to contact me, Giulio Coraggio.
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Saturday, January 23, 2010
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The Italian Government is in the process of implementing the so called Audiovisual Media Services EU Directive (“AVMSD”) which was merely meant to amend the Television Without Frontiers EU Directive to extend its scope to new technologies (e.g. on-demand audiovisual media services, satellite TV etc.).
However, the law proposal submitted by the Italian Government goes a way beyond the scope of the AVMSD and extends the applicability of the regime of broadcasters also to video hosting platforms like YouTube by including in the definition of “audiovisual media service” (and thus making it subject to the relevant rules):
"services, also transmitted through the internet, consisting in the provision or the availability of animated images, with or without audio, in which the audiovisual content is not merely marginal do fall within the afore mentioned definition".
According to such definition, which is not included in the AVMSD, video hosting websites like YouTube would be deemed as an audiovisual media service and as such it should comply, with all obligations specifically enumerated in the AVMSD, which include - among others:
  • the need to obtain a prior authorisation for the performance of the broadcasting activities from the Ministry of the Communications; and
  • the obligation to broadcast videos in compliance with the terms and conditions agreed with the right holders without broadcasting programs, or offering, on whatever kind of platform , programs or part of programs of third parties, without their consent.
Moreover, video hosting websites will be considered to exercise an "editiorial responsability" i.e. an effective control both over the selection of the programmes and over their organization. In this context, an "effective control" is defined by the law proposal implementing the AVMSD (and this is a peculiarity introduced by the Italian legislator) as "the possibility to take decisions on the adding or the removal of contents, their positioning, the modalities of presentation to the public [e.g. also the mere framing], the allowance of codes or the determination of other search modalities available to users within a catalogue". 
This means that – if the law proposal passes - video hosting websites like YouTube will lose the hosting provider liability exemption prescribed by the E-Commerce Directive and would be considered liable for all the copyright violations carried out through the videos uploaded on its platform by their users regardless of whether it has knowledge or it has been notified of them. Also, there is a risk that court might extend this liability also to any defamatory or illegal content published on the platform.
The law proposal has been highly criticized since it is in contrast with the scope of the AVMSD whose recitals expressly exclude from its scope “private websites and services consisting of the provision or distribution of audiovisual content generated by private users for the purposes of sharing and exchange within communities of interest” and it might be also challenged before the European Court of Justice. Also, this is in contrast with the principles set forth in the E-Commerce Directive which do not oblige ISPs to monitor the contents provided by their users and stored on their platforms and excludes their liability for such contents.
If you want to discuss the implications of this law proposal on your business, feel free to contact me, Giulio Coraggio.
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Thursday, January 21, 2010
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Dear Reader,
If you found my blog interesting and you will be in London next week, I would love meeting you in person to discuss about Italian gaming law or also just for a chat.
I will be in London from the 24th to the 29th of January to attend the Legal Gaming in Europe Conference and the IGE. Send an email to me, Giulio Coraggio, so we can meet up for a beer.
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Tuesday, January 19, 2010
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The draft decree setting out the new regime under which the Italian Gaming Authority will issue new online gaming licenses during the next months also contains interesting “surprises” for gaming operators. 
Indeed, the draft decree expressly prohibits the installation of gaming terminals connecting to online gaming websites run by licensees in public places. This kind of gaming terminals called “TOTEM” have become very popular in Italy and the biggest gaming operators have placed them in a number of coffee shops, department stores and gaming halls gaining a considerable advantage from them since players can recharge their gaming account through totems and because they represent a unique tool to connect the online world with offline premises. 
However, the potential damages that current gaming operators can face because of these new bans might represent a considerable advantage for new entrants in the Italian gaming market. In fact, since the competition between gaming operators will take place only in the online world, this circumstance might lower the gap between current operators and new entrants; the operators that will launch the best platforms, the most interesting games and the best marketing initiatives might attract a considerable number of players in a short term.
Do you need more information on the Italian gaming market and on the requirements necessary to obtain an Italian gaming license? Contract me, Giulio Coraggio
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Friday, January 15, 2010
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As a consequence of the next issuance of new gaming licenses by the Italian Gaming Authority, some foreign gaming operators asked me…, what are the benefits of an Italian gaming license?
Well, the answer is…: without an Italian gaming license an operator cannot offer its games to Italian residents!
Indeed, regardless of the fact that an operator already holds a gaming license in an European or non-European country, the offer of games to Italian residents in absence of an Italian gaming license is sanctioned with the imprisonment up to 3 years. Moreover, the Italian Gaming Authority has obliged Internet Service Providers to put in place filters that block the access by Italian residents to non-licensed gaming websites. Therefore, Italian residents are not able to access to non-licensed websites, but if they try to do so a white page with the logo of the Italian gaming authority will be displayed on their screens. 
Furthermore, since Italian criminal law sanctions with the imprisonment up to 3 months also the advertising to the benefit of Italian residents of non-licensed websites, an additional benefit of holding an Italian gaming license is that the website would be able to actually perform marketing and advertising activities to the benefit of Italian residents.
The benefits deriving from an Italian gaming license will increase more and more in the next months since in March 2010 operators will be able to launch online cash games and casino games. Indeed, the new licenses granted by the Italian gaming authority will cover the following online games:
  • skill games,
  • tournament and solitaire poker games,
  • cash poker games,
  • casino games;
  • fixed odd and totalisator sports, horse and other events betting,
  • horse pools and
  • bingo.
The Italian gaming market is already the largest European gaming market, but since its opening up is still recent and there might be potentialities for a further growth. If you need assistance on obtaining an Italian gaming license, feel free to contact me, Giulio Coraggio.
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Monday, January 11, 2010
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The Italian Gaming Authority has now issued a Decree governing the so called “system bets” on fixed odd sports events different from horse events and on non-sports events. System bets are a set of fixed odd bets generated combining different results that are contemporaneously validated through a unique receipt of participation.
System bets are distinguished in different categories (i) integral systems (ii) systems with corrections and (iii) integral systems with corrections. The maximum win awarded through a system bets cannot be higher than € 50,000, while the potential win for each bet which is part of the win cannot exceed € 10,000.
The Italian Gaming Authority through this Decree tried to meet the requests from betting operators introducing a mechanic which was not previously possible and that makes now the offer of Italian licensed betting websites even closer to the one of the .COM websites.
Do you need assistance on Italian betting law issues, feel free to contact me, Giulio Coraggio.
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Thursday, January 7, 2010
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After the publication on Facebook of violent statements against the Italian Prime Minister, Mr. Berlusconi, the Italian Minister of Home Affairs, Mr. Maroni, proposed the blocking of the access by Italian residents to all the social networks.
Following the considerable complaints to which such proposal led, Mr. Maroni proposed a 3 steps measure: in case of illegal content published on websites

  • judicial authorities will order the removal of the material to the user who uploaded it;

  • if the user does not comply with the order. he will be fined and judicial authorities will order the removal of the material to the Internet service provider hosting it;

  • if the provider does not comply with the order, judicial authorities will order to Internet service providers to block the access by Italian residents to the website hosting the illegal material.
However, as a consequence of a meeting with Internet providers, the Minister of Home Affairs has now reached the conclusion that a Self-Regulatory Code entered into by the Italian and foreign Internet providers might be the best solution for the matter, also because of the difficulties of enforcing orders against foreign providers.
Is this the right approach? Since the ubiquity of the Internet cannot be constrained by local laws, shall the players in the market set the applicable rules? I would be interested in knowing your view on the matter, send your opinion to me, Giulio Coraggio.
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Monday, January 4, 2010
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The Italian Gaming Authority has notified to the European Commission the draft decree setting out the new licensing regime that will govern the issue of the new online gaming licenses to the operators willing to enter into the Italian gaming market and that prescribes additional obligations for the current and new licensees. The EU Member States and the European Commission will be able to raise comments on the draft decree up to 19 March 2010 when the so called "stand still" period will expire. If no relevant comments are filed, the decree is expected to the published on the Official Gazette shortly later and, from the publication date, operators will be entitled to apply for an Italian gaming license.
Operators interested in the Italian gaming market have therefore a 3/4 months period to arrange their business and infrastructure to be ready to meet the requirements prescribed by the new licensing regime.
If you need assistance on the proceeding and requirements necessary to obtain an Italian online gaming license, on the obligations deriving from its issue as well as on the setting up and management on an Italian licensed gaming website, please contact me, Giulio Coraggio.
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Saturday, January 2, 2010
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The Italian Supreme Court has issued a decision in a criminal proceeding against www.thepiratebay.org, a P2P website because of the breach of copyright laws through the making available to the public of copyright protected works. In particular the Court held that Pirate Bay is liable since it does not merely make available to users the transfer data protocol allowing the file sharing but:
it indexes the information that are uploaded by other users so that this information - even if the activity of the provider is reduced to a minimum - is still essential for users to navigate through the website and find the files they are looking for, are developed and made available on the website, eg. by means of a search engine. In this case, the website ceases to be a mere "courier" who arranges the transport of data. There is a something more, as it is made available to the users of the website also a constantly updated index that allows users to find out the content of the files
According to the Supreme Court, there is a contribution by the provider to the illegal conduct performed by its users since it facilitates its performance.
The Supreme Court also adds:
it would be possible to argue the lack of involvement of the website to the the diffusion of the copyright protected work only in the extreme case in which its activity was completely "agnostic", where, for example, even the indexing of the data is decentralized [i.e. it is not performed by the website, but by its users]. In this case there would be a community of users (a social network) that share a transfer data protocol and that index the data allowing the searching of their essential information. In such case, the material shared and made available for the transfer might be of different types (and not necessarily copyright protected) and the criminal liability would only apply to those users who carry out the uploading and and indexing of the data”.
The decision is relevant also because it clarifies that:
  • Italian courts have jurisdiction on a foreign website even if the relative server is located abroad if the users downloading the copyright protected works are in Italy and therefore the illegal conduct is completed in the Italian territory; and
  • the seizure of a website can take place through an order obliging Italian ISPs to block the access by Italian users to such website.
As a general comment, the position of the Supreme Court is quite surprising since it does not take into account that the E-Commerce Directive prescribes the general principle of non-liability of ISPs for the activity performed by their users and the absence of any obligation by ISPs to monitor their users’ activity. Also, the reference to the “indexing” of data appears excessively broad and subject to different interpretations. 
If you want to discuss about the implications of this decision for your business, feel free to  contact me, Giulio Coraggio.
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