Italy Reshapes Gambling Market with €7M Licensing Plan

Italy has officially confirmed that 46 operators have submitted applications for its revamped online gambling licences, which now come with a price tag of €7 million each. This marks a significant turning point in the country’s efforts to modernise and regulate its online gaming sector. The application window closed on July 1, with all bids successfully passing the initial compliance screening by Italy's gambling regulator, the Agenzia delle Dogane e dei Monopoli (ADM).

This marks the first step in a broader regulatory overhaul intended to eliminate grey-market activity, enhance consumer protection, and ensure a more transparent and compliant industry. The updated licensing structure is considered by legal and regulatory experts as one of the most stringent frameworks now in force within the European Union.

Overview of the new licensing framework

The current process offers a total of 52 online gambling licences, available to operators that meet the country’s newly revised criteria. The licences, which cover online sportsbook betting, casino games, and bingo, will be valid until 2034, giving operators a decade of market access under the new terms.

Italy has overhauled its previous licensing model, which had been in place since 2018 and permitted operators to obtain a licence for a comparatively modest fee of €200,000. The stark increase to €7 million, coupled with new technical and compliance demands, underscores the government’s desire to attract only well-resourced and responsible gaming companies.

• Key requirements under the new framework include:
• Operating exclusively under a .it domain to streamline oversight
• Payment of an annual 3% fee on net gaming revenue
• A mandatory 0.2% contribution of net revenue toward responsible gambling initiatives

These measures aim to limit market fragmentation, improve security protocols, and ensure long-term sustainability in a sector historically marked by inconsistent enforcement.

Strong interest despite higher costs

Despite the considerably higher entry fee, the fact that 46 operators have submitted applications signals enduring interest in Italy’s lucrative online gambling market. Among the applicants are established European brands with a history of compliance in other regulated markets, as well as several new entrants seeking to expand their footprint in Southern Europe.

The Italian government has not yet publicly disclosed the names of all 46 applicants. However, industry insiders report that the pool includes a combination of major international firms and locally based operators. The government's cautious approach to naming names likely stems from the need to avoid market speculation or legal risk during the review phase.

Market consolidation and grey market reduction

The primary objective of the reform is market consolidation. Currently, more than 400 gambling websites are active in Italy, with many operating in regulatory grey zones. A number of these sites are hosted outside the country and may not meet Italy's regulatory, tax, and consumer protection standards.

With the new structure, Italy is aiming to drastically reduce this number. Industry estimates suggest that the number of licensed operators will shrink from 88 to approximately 50, with the new system in place by 2026. This deliberate reduction reflects the government's “quality over quantity” strategy, designed to prioritise player protection, AML compliance, and corporate accountability.

Interestingly, despite the expected reduction in the number of operators, analysts forecast that the market’s gross gaming revenue (GGR) — currently hovering around €5 billion annually — will remain steady. Larger and better-funded companies are expected to absorb the existing demand, ensuring minimal disruption to the national gaming economy.

The compliance pathway: What operators must prove

The first stage of the process, involving administrative screening, has been completed. All 46 applicants cleared the preliminary checks regarding their corporate registration, prior compliance history, and basic legal eligibility.

The next phases are more rigorous. The ADM is currently conducting in-depth technical evaluations of each applicant’s IT infrastructure, data security protocols, anti-money laundering (AML) systems, and responsible gambling tools. This includes detailed scrutiny of encryption standards, customer identity verification processes, and the ability to detect and report suspicious transactions.

Following this, each applicant will undergo a financial audit. The authorities will assess the financial stability of each company, examining factors such as liquidity, reserves, solvency ratios, and ownership transparency. Companies that fail to meet these financial benchmarks may be disqualified, regardless of their market reputation.

Final decisions are expected to be announced in early autumn 2025. Approved operators will have over a year to fully align their operations with the new requirements before the existing licences expire on 31 December 2025.

Legal and policy context

The overhaul of Italy's gambling regime is occurring within a broader legislative effort aimed at tightening public-sector controls over the gaming industry. The new measures were passed after extensive debate in parliament, with lawmakers citing widespread concerns over under-regulated online gambling, tax evasion, and consumer vulnerability.

The 3% annual levy on net gaming revenue is expected to provide the government with a new, sustainable source of fiscal revenue, while the earmarked 0.2% for responsible gambling will support treatment programs, public education, and research into gambling-related harms.

Importantly, the shift to a single .it domain per operator is also designed to improve traceability. This will make it easier for Italian authorities to monitor advertising practices, payout ratios, and customer dispute resolution mechanisms.

Impact on small and medium-sized operators

One of the more contentious aspects of the new framework is the financial barrier to entry. The €7 million fee — along with operational costs linked to compliance, security, and reporting — may prove prohibitively expensive for small or medium-sized firms.

While this may raise concerns about market monopolisation, the ADM maintains that such standards are necessary to protect the integrity of the gambling sector and ensure long-term player safety. In legal terms, Italy has justified this approach as proportionate and necessary to meet its obligations under EU law.

Several legal experts have noted that the new licensing model is likely to withstand scrutiny under the principles of the EU Services Directive, provided the government can demonstrate that the fees and requirements serve legitimate policy goals — namely consumer protection and fraud prevention.

Broader implications for Europe

Italy's licensing reform is being closely watched by regulators across the European Union. Countries such as Spain, Germany, and the Netherlands have faced similar challenges with grey-market operators and inconsistent enforcement.

If Italy’s model proves effective — by reducing unlicensed play, increasing tax revenue, and maintaining a healthy market — it may serve as a blueprint for future reforms elsewhere in Europe. Already, some jurisdictions are reportedly considering aligning licence fees with actual compliance costs, rather than using symbolic or flat-rate pricing.

Furthermore, the emphasis on responsible gambling funding and tighter domain controls could gain traction as best-practice standards in pan-European regulatory discussions.

Conclusion

Italy's new online gambling licensing regime marks a significant transformation in the country’s regulatory philosophy. By introducing a more expensive, stricter, and technologically advanced licensing system, the government aims to modernise the industry, protect consumers, and reduce illicit market activity.

The process, which has already attracted 46 applicants, is expected to lead to a leaner but stronger sector. The transition may be challenging for some operators, particularly those with limited financial resources, but the long-term benefits could include increased trust, higher compliance, and a more resilient regulatory framework.

As Italy moves toward full implementation in 2026, the international gambling community will be watching closely — not just to see who gets a licence, but to assess whether this new model can deliver on its ambitious goals.

FAQs

Why did Italy increase the gambling licence fee to €7 million?
The government increased the fee to attract serious, financially stable operators and to fund stricter regulatory oversight and responsible gambling efforts.

What types of games are covered under the new Italian licences?
The licences will cover sportsbook betting, online casino games, and online bingo.

When will the new licences come into effect?
Approved operators will begin operating under the new licences starting in 2026, once the current licences expire at the end of 2025.

How many operators are expected to remain in the market?
Estimates suggest the number will drop from 88 to around 50, due to higher financial and compliance barriers.

Are current licence holders required to reapply?
Yes, all existing operators must reapply and meet the updated conditions to continue operating in Italy.

Will this new framework affect consumers?
Yes, it is expected to improve player protection, reduce access to unlicensed sites, and provide a more secure gaming environment.

How is the Italian regulator enforcing these rules?
The ADM is conducting technical, financial, and compliance audits of each applicant before granting licences.

Are smaller operators at a disadvantage under the new rules?
Yes, the €7 million fee and compliance requirements may be prohibitive for smaller companies, which could lead to market consolidation.

Is Italy’s licensing model aligned with EU law?
Legal experts believe the model is justifiable under EU law, as it promotes consumer protection and fair competition.

Could other countries adopt a similar approach?
Yes, several EU member states are observing Italy's reforms closely and may consider adopting similar measures in their own markets.