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.