Italian online gambling operators get court victory on license extension

An uncertainty remains on the status of licenses, which does not help the market

Italian courts recognized online gambling operators’ right to continue operating under their expired license issuing an interim injunction allowing the temporary extension.

The uncertainty on the future of Italian gambling licenses

In a previous post, I had discussed the situation of some operators whose license was due to expire in October 2020.

The Italian budget law 2016 regulating the recently-ended tender for Italian remote gambling licenses had prescribed just a 4-year duration for the “alignment in time, as on 31 December 2022, of all licenses relating to the offering of the games at a distance” with the explicit goal to ensure that all the Italian remote gambling licenses, including those expiring before the end of 2022, will expire at the same time on 31 December 2022.  And this circumstance was confirmed by the Italian budget law 2020, which established that the Italian gambling authority “shall award the following concessions through an open, competitive and non-discriminatory procedure to be launched by 31 December 2020: [—] e) 40 rights to be able to offer games at a distance with an auction basis of not less than EUR 2,500,000 for each right”, urging the regulator to launch a tender for new remote gambling licenses by the end of the year.

There is no surprise that due to the above-mentioned provisions and since there is no pending tender for new licenses and therefore the possibility to apply for new licenses, Italian licensed operators were stunned to receive a termination notice from the Italian gambling authority a few days before the expiry of their license.

The appeal against the decision of the Italian gambling authority

The Italian gambling authority’s termination notice translated into a rough reaction from operators that filed plenty of appeals seeking an interim injunction from administrative courts suspending the termination of licenses.  And the groundedness of the position of Italian operators was confirmed by the Administrative Court of Rome, which upheld their position, granting the required suspension.

It does not mean that the licenses are automatically extended, though.  Operators’ websites cannot be disconnected from the servers of the regulator and they can continue offering their games up to October 2021, when the hearing on the case’s merits will be held.

What happens to the other operators?

There is no problem for operators that recently gained a new license since their license will expire at the end of 2022.  On the contrary, there are some operators whose license term will expire in the coming days.

The above-mentioned decision of the Administrative Court of Rome does not lead to an automatic extension of the license of other Italian gambling operators.  However, the Italian gambling authority might decide that – given the court’s position – they will not terminate the license of other operators.

As occurred with previous tenders, it would be beneficial that ADM takes a clear stance, allowing operators to continue to operate against their commitment to join the upcoming tender.  Such an approach would avoid useless disputes with costs for operators and the State and help the market gain more credibility in the current financial crisis.

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Giulio Coraggio

I am the head of the Italian Technology sector and the global head of the IoT and Gaming and Gambling groups at the world-leading law firm DLA Piper. IoT and artificial intelligence influencer and FinTech and blockchain expert, finding solutions to what's next for our clients' success.
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