Italy’s regulated gambling sector is caught in a regulatory deadlock that threatens to accelerate unregulated competition, industry representatives warned the Senate this week. EGP-FIPE, the trade association for licensed operators within Italy’s broader commercial federation, laid out a bleak picture to the Constitutional Affairs Committee: the current mishmash of national, regional, and municipal rules has essentially frozen market development and weakened consumer protections.

The Problem with Fragmentation

The real issue? Repeated extensions of gambling concessions paired with inconsistent territorial rules that make any coherent network planning impossible. According to EGP-FIPE president Emmanuele Cangianelli, the system sits “stuck between extensions and non-homogeneous territorial rules,” creating a governance vacuum that damages both business viability and the very protective mechanisms lawmakers say they’re trying to uphold.

Local restrictions on land-based operators have become a flashpoint. Proximity buffers, strict opening-hour limits. Municipalities defend these as consumer protection, but the reality tells a different story: they don’t eliminate gambling activity. They displace it. Players simply move to online platforms or, worse, to unregulated markets where there’s minimal or no oversight at all.

“Where physical supply is rigidly restricted, the problem isn’t reduced, it’s relocated,” Cangianelli explained. “Play moves online or underground, where control is effectively absent. This creates distortions in legality and sustainability across the entire authorised network.”

Advertising Restrictions Under Scrutiny

The debate heated up recently after the Italian Football Federation weighed in, calling on government to rethink the 2018 blanket ban on gambling advertising and sponsorships. Outgoing FIGC president Gabriele Gravina called the restrictions “largely ineffective,” pointing to a 2022 Parliamentary Commission report that documented continued growth in underage and illegal gambling despite the advertising prohibition.

There’s a fundamental disconnect here: regulatory intent and market reality don’t match. Piecemeal interventions targeting isolated concerns often fail to deliver results while creating competitive distortions that actually benefit the unregulated sector.

Technology and Governance Solutions

EGP-FIPE stressed that existing and emerging tools matter. Self-exclusion systems, play-behaviour tracking, advanced technological monitoring. These could substantially improve consumer protection. But here’s the catch: they only work with stable national governance coordinating efforts across fragmented regional and municipal authorities.

“A clear governance structure is essential,” Cangianelli stated. “Regions may have a role, but only within a shared national plan. Otherwise, partial interventions continue to accumulate without solving anything.”

Italy’s market is transforming fast. Last November, the Agenzia delle Dogane e dei Monopoli compressed the licensing ecosystem from over 400 operating domains into just 52 consolidated licences. Effectively an oligopoly among major incumbents. The move generated approximately €364 million in licence revenues, positioning Italy among Europe’s largest online gambling markets by turnover and tax contribution.

The real question now: can policymakers build a coherent national framework that supports this consolidated, regulated market while actually delivering consumer protection instead of inadvertently strengthening the unregulated alternative?