Italy to Auction 17,000 Online Poker & Gambling Licenses

Seen as yet another indicator towards liberalization of gambling restrictions in Europe, the Italian government has announced that it will auction off 17,000 licenses for betting shops, kiosks, casinos as well as for online casinos, poker rooms and sportsbooks.

This is in preparation for January 1st, when all Italians will be able to legally play online poker.

In spite of not being sure what the potential for the new Italian market is, initial reports say that Betfair, William Hill and Ladbrokes are poised to grab their share of the auctioned licenses.

In fact, the European Union Commission just Dec. 20 cleared William Hill's proposed joint venture with Codere to enter the Italian gambling market. This enables them to exploit betting licences being issued by the Italian regulatory authorities in the new year.

Europe's 50 billion euro (approximately $65 billion US dollar or 130 billion pound) market has become even more critical to the gambling sector since the Unlawful Internet Gambling Enforcement Act (UIGEA) was signed into law by the USA in October, making it illegal for financial institutions to handle online gambling transactions from US residents.

The loss of US players caused many legally-licensed companies to lose upwards of 50-60% of their value overnight. It also caused many publicly-held companies to either sell off US-facing parts of their companies or go private to avoid shareholder lawsuits.

Many companies are now regrouping around Europe with new games offered in a variety of languages.

Several large U.K operators appear well-placed to take advantage of the new European laws. Gala Coral already operate an Italian-language site and a betting shop in Genoa, William Hill has a venture with Spanish firm Codere for Spain, and Ladbrokes completed a deal with Italian firm Pianeta Scommesse back in August as well as buying three betting shops in Turin last month.

Meantime, many other countries such as Spain and Belgium, who had formerly viewed gambling as marginally acceptable, are now moving toward regulating the sector. This is due in large part to increased access to gaming brought about by advances in technology, because more people have access to the Internet, and because of now-possible controls for regulation, enforcement and protection of minors and at-risk users.

Greece, Ireland, Hungary, Poland and the Czech Republic are watching closely to see how early adopters fair.

Simultaneously, the European Commission is trying to ensure that any changes to gambling laws across Europe comply with rulings by the EU that countries not interfere with healthy competition. According to a judgment by the EU's highest court, member states may place curbs on private gambling operators, but these must be "non-discriminatory, proportionate and consistent".

This especially presents a challenge to countries, including Germany France and Poland, to justify that present laws are not simply there to protect state-owned gambling and lottery monopolies.

Charlie McCreevy, EU internal market commissioner, has already brought infringement proceedings against at least half a dozen countries for restrictions on betting markets.

Last month McCreevy told the European parliament that there is "Not a chance," for consistent Europe-wide legislation on internet gambling at this time.

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