Evaluating Regulatory Ineffectiveness: The Proliferation of Italy’s Online Gambling Black Market

Evaluating Regulatory Ineffectiveness: The Proliferation of Italy’s Online Gambling Black Market

Cheryl Jones

Managing Director, IC360 Advisory, EMEA

Nov 14, 2023

The European Gaming and Betting Association (EGBA) have highlighted a growing concern in a new article: EGBA concern at reported size of online gambling black market in Italy, after concerns at the reported size of online gambling black market in Italy. La Gazzetta dello Sport reported that the estimated total of wagers placed by Italians on the black market, encompassing both land-based and online bets, amounts to €25 billion annually.

The intricate laws and regulations governing Italy’s gambling landscape have been under scrutiny for quite some time, reflecting a pressing need for reassessment and revision. The EGBA’s article brings to the forefront vital areas of concern such as consumer vulnerability, the effectiveness of regulatory enforcement, and the restrictive advertising rules faced by licensed operators. As we navigate through the EGBA’s insights, we will explore the various aspects of these issues, unveiling the complexities and proposing potential pathways toward a more secure and regulated online gambling environment in Italy.

Consumer Vulnerability:

The large scale of the black market indicates a significant number of Italian gamblers are exposed to platforms that lack essential consumer protections. Betting on unlicensed platforms implies risks such as fraud, lack of payment security, and irresponsible gambling practices.

Awareness campaigns might be instrumental in educating consumers about the risks associated with unregulated gambling websites, helping them make informed decisions.

Regulatory Enforcement:

Despite the admirable efforts by the ADM in blocking unlicensed gambling websites, the persistence and growth of the black market signify that enforcement alone might not be sufficient. It suggests a need for a more holistic approach, possibly involving international cooperation to tackle cross-border online gambling services.

The government could explore technological solutions to enhance the effectiveness of blocking and tracing unlicensed operators.

Advertising Restrictions:

Italy’s stringent advertising restrictions on licensed operators seem to inadvertently favor the black market. Lack of adequate advertising from licensed operators leaves consumers less informed about which platforms are regulated and safe.

A reconsideration of the advertising policies, allowing responsible advertising by licensed operators, could improve the visibility of compliant platforms, aiding in consumer decision-making. As stressed by Maarten Haijer, Secretary-General of the EGBA: “The significant size of Italy’s online black market is concerning, yet it is not surprising given that Italy has one of Europe’s strictest advertising regimes for its licensed gambling companies.”

Policy Revisions:

Policies need to be adaptable and responsive to the evolving landscape of the online gambling industry. The Italian authorities could consider revising existing rules to strike a balance that encourages compliance, protects players, and discourages black market operations.

Comparative analysis with countries having effective regulation could offer insights into best practices and policy adjustments necessary for Italy.

Multi-Stakeholder Collaboration:

Collaboration between regulators, industry stakeholders, and consumer protection agencies could foster a more resilient regulatory framework. Such collaboration could facilitate sharing best practices, technological solutions, and awareness initiatives.

Engagement with EU institutions could also be beneficial, ensuring alignment with broader European objectives and standards in the gambling industry.

In conclusion, addressing Italy’s online gambling black market requires a multifaceted strategy that prioritises consumer protection, enhances regulatory enforcement, revisits advertising restrictions, and promotes collaborative approaches to policy and regulation. Such a nuanced strategy would contribute towards a safer and more compliant online gambling environment in Italy.