Recent and upcoming regulatory changes in Italy are expected to increase the  popularity of betting on sports and horses in the country.

Recent regulatory changes as well as upcoming changes are expected to boost the Italian sports betting and  horse betting markets after years in which they have  been overshadowed, first by poker games and then  casino games.

The coming into force in July 2013 of regulations  allowing the offering of types of bets and events that  are not included in the official schedule published by  the Italian gambling regulator, AAMS, represented a  major opportunity, especially for foreign sports betting  operators. Indeed, foreign operators for whom a major  strength is the variety of types of bets and events offered  to their customers on .COM platforms were previously  prevented from relying on such a massive advantage on  their Italian platforms. 

The scenario has now completely changed. Local  operators that do not have experience on such new  types of bets/events are suffering from the competition  from foreign operators. This explains the increase in  the market share of both William Hill and Paddy Power,  which are still new in a market that – with the exception  of poker games – has been controlled for years by the  three major Italian operators, i.e. GTech/Lottomatica,  SNAI and Sisal. 

And such change is expected to be further boosted if the Government also changes the tax regime for sports  betting games as part of the measures implementing the  so called “Delega Fiscale” decree. In fact, the current  turnover-based tax regime for sports betting prevents  operators from offering odds in line with their .COM offering without taking major risks of losses. However,  the Government showed some openness towards a  change in the taxation for sports betting, switching to  a 20% gross gaming revenue tax, which was already  adopted for casino and cash poker games with good  results. The upcoming measures enforcing the principles  set forth in the Delega Fiscale Decree, which must be  adopted by the end of the year, are a good opportunity  to put in place such important changes. 

However, the measures enacting the Delega Fiscale decree also have the purpose of recovering the horse  betting market from the current decline. Indeed, Italy  has traditionally been a country where the horse betting  sector has been quite strong, with all the main cities  hosting their own racecourses. However, the popularity achieved by other games and a burdensome tax regime inherited from previous regulations led to a strong contraction of the market. 

The new regulations, on the other hand, are meant to  make horse betting more attractive for players. And one  of the options on the table is to allow the launch of types  of bets with international liquidity, which was already  prescribed by AAMS regulations some years ago. At that  time, because of technical difficulties, their offering was  then suspended, but this does not prevent their offering  from re-emerging in the future. 

Finally, the launch of bets on virtual events at the end of  2013 was shown to be very successful, especially with  reference to their offering in betting shops, which was  mainly because of connection issues affecting the remote  offering of games. Italy is expected to be a market  generating €1 billion in turnover for bets on virtual  events, and if such connection issues are sorted – as  is expected to occur shortly – the market might grow  considerably.