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Compliance issues of social gaming are still a problem for many operators offering games in Italy. And indeed there are several regulatory issues to take into account.
Article 718 of the Italian criminal code punishes with the imprisonment up to 1 year and with € 209 of fine the offering of gambling activities in public places, or places open to the public and Article 721 of the Italian criminal code prescribes that gambling activities are those carried out:
- with the purpose to gain profit and
- where the circumstance that the winning or the loss is totally or almost depending on the chance.
Moreover, Article 4 of Law 13 December 1989 No. 401 sanctions with the imprisonment from 6 months to 3 years the organization, performance, and offering of any land-based or remote game set up or regulated by the Italian gambling authority, AAMS, without the required Italian gaming license.
Also, what is interesting is that both the Italian criminal code and Law 401/1989 provide criminal sanctions even for players participating in such games. Additionally, article 4.2 of Law 401/1989 sanctions whoever advertises illegal gambling activities. Hence it is crucial to assess whether a social game can fall under the umbrella of criminal law provisions banning illicit gambling activities.
There is no single answer to such an issue. A lot depends on how the game is structured, whether there is any payment by players (e.g., in the case of virtual currency), players or operators gain any profit through the game (e.g., the possibility to play longer on the platform), and it is a skill game or a game of chance, etc.
The most recent Italian case law, which focuses mainly focused on land-based video poker games, provided guidelines on the interpretation of “profit.” Also, prize competitions run in connection with social games have been recently requalified in some instances as the offering of gambling games. Furthermore, social games, in any case, need to comply with advertising regulations whose breach is subject to a fine up to € 5,000,000. And guidelines on the difference between social games and gambling has been given by recent AAMS decrees.
Italian authorities will likely be more aggressive against the unlawful offering of games and therefore a case by case review of the compliance of social games with Italian law is recommendable.
