IS ITALY ABOUT TO REGULATE ONLINE GAMBLING?

(544) (28-September-2006)

From website blockades to a regulatory regime - how things can change

One of the more encouraging news items this week was reported by Poker News, which carried an article claiming that Italy has apparently done a radical about-turn in its approach to online gambling.  It appears that the Italian authorities are going from website blockades instituted with local ISPs through the AAMS , to a UK style regulatory and taxation regime.

The Poker News report says that Italy has had an interesting relationship with online gaming. In February, the country attempted to ban all IP addresses of online gaming sites - well over 600 in all - and then a few days later reportedly tried to set up an 'exclusive' relationship with an online poker room, allegedly for a slice of the pie.

Now, Italy is moving toward regulation of the industry. As of January 1, 2007, it will be legal for Italian citizens to gamble online. The new law also clears the way for things like public sports betting and bingo parlours.

This piece of legislation regulates all 'ability based and fixed betting activities'. The Italian plan is apparently informed by the U.K. initiative when it comes to how the entities that do business in Italy are regulated. If a company does business with Italian customers, the government will stand to make a 3 percent tax on any gaming based revenues acquired by the company.

Such a radical change of direction begs the question, "Will operators be flocking to set up in Italy?" There are certainly worse places to be in the world!

Whether this promising move will in time influence the approach of U.S. legislators who seem determined to ban online gambling has yet to be seen.

In recent days, it has become increasingly clear that the U.S. Senate is unlikely to pass the Internet Gambling Prohibition Act in any form, whether as a stand-alone bill, or attached to other legislation before the Senate takes its election recess starting at the end of this week. History has shown that post-election 'lame duck' sessions of Congress are reluctant to discuss any proposed legislation that has heated opposition, or especially complex issues attached to it.