Responsible Gamingfrom the Italian Regulatory

Perspective

Paf Responsible Gaming SummitSeptember 29th, 2015

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AAMS – Till 30 November 2012

Part of the Ministry of Finance

Autonomous budget

Italian Gaming and Tobacco Regulator

Established on 1928 (Tobacco manufacturing)

Gaming Regulator since 2002

2,700 employees

14 Regional Offices – 60 Provincial Offices

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AAMS – From 1 December 2012

Law-Decree 95/2012: The Italian Customs Agencyand the Autonomous Administration of State Monopolies are merged.

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Organisation

Customs Area

• 9,000 employees• Collecting and managing

customs duties• Collecting excise duties on

production and consumption• Dealing with appeals

procedures in the international trade

Monopolies Area

• 2,700 employees• Regulating and controlling the

entire gambling sector• Combating illegal activities• Granting “concessions” to

gambling operators and • Monitoring of all gambling

transactions

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Italian Online Gambling Market€m

€749m

Casino Games

Sports Betting

€725m

+2%

+2% -3%

Other games (*)

€735m€690m

+7%

-4%

-2%

-15%

Poker

-20%

-20% +15%

€728m

+0.4%

+11%

+9%

+8%

-20%

+63%

-36%

(*) Other games: Skill Games, Betting Exchange, Bingo, Pool Betting, Horse Betting, Lotteries, Betting on virtual sports.

-8%

+199%

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Online Gambling Tax Revenues€m

€182m

Poker

Casino Games

Sports Betting

€182m

-16% -4%

+186%

-14%

-1% 0%

Other games (*)

€184m

€167m

+1%

-2%

-9%-8%

+11%

+70%

-36%

-24%

€165m

-9%

+19%

+8%

-17%

+2%

(*) Other games: Skill Games, Betting Exchange, Bingo, Pool Betting, Horse Betting, Lotteries, Betting on virtual sports.

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Land-Based vs. Online in Italy 2014

GGR Tax revenues

2.3%

Land-based €16.8b

Online €0.7b

TOTALE €17.5b

Land-based €7.8b

Online €0.2b

TOTALE €8.0b

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GGR 2014 Land-based + Online

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Online Player ProfileActive monthly

players-4%

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VALIDATIONSYSTEM

MonitoringAdministrativeManagement

DatabaseDATABASE

Real-Time Monitoring

LICENSEE

FRON

T END Betting Shops

Slot Machines

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What Online Games are Regulated?Already available:• betting on horse races (since June 2001) • fixed odds sports betting (June 2002)• scratch cards (“Gratta e vinci”) (November 2006)• pool sports betting (March 2008)

• games of skill / poker tournaments (September 2008) • “superenalotto” and “superstar” lotteries (July 2009)• bingo (December 2009)• cash poker (July 2011)• casino (without “slots”) (July 2011)• slot-machines (December 2012)• lotto (April 2013)• virtual sports (December 2013)• customised markets in sports betting (September 2014)• betting exchange (April 2014)

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2009 Reform – What’s New

– Just one “concession” for all regulated online games– HQ/Server located in the EEA– Not-gaming companies can now apply– Improved consumer protection

• Dedicated bank account for players’ deposits• Improved transparency• Mandatory self-limitation

– Revised sanctions for licensees– “.com” operations prohibited– Players’ personal data communication to AAMS

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2009 Reform – Effects

Effective: July 2011

150 (updated) + 45 (new) concessions

EU-compliant regime

May 2010:2 infringement procedures closed

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Fighting Illegal Operators

ISP blocking5,000+ web sites, monthly updateEasy to circumventEffective awareness tool

Advertising ban for unlicensed operators

Italian licensees must prevent Italian residents from accessing their “.com” products

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European Commission

Communication, 23 October 2012. Key objectives:

Compliance of national regulatory frameworks with EU law;

Enhancing administrative cooperation and efficient enforcement;

Protecting consumers, minors and vulnerable groups;

Preventing fraud and money laundering;

Safeguarding the integrity of sports and preventing match-fixing

First Expert Group meeting: 5 December 2012

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European Commission / 2

Recommendation, 14 July 2014. Key objectives:

Information requirements for gambling websites to ensure that consumers are provided with sufficient information to understand the risks related to gambling. Commercial communication should be carried out in a responsible way.

Rules to minimise the contact of minors with gambling, including through advertising or promotion of gambling services.

Operators to keep track of player behaviour and raise the alarm if necessary.

Ongoing support to players to prevent gambling-related problems: tools to set spending limits, to get alerts about winnings and losses whilst playing, and to take time out from gambling.

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European Commission / 3

Recommendation, 14 July 2014 / Cont’d

Players should have access to helplines they can call for assistance about their gambling behaviour, and they should be able to easily exclude themselves from gambling websites.

Advertising and sponsorship of online gambling services should be more socially responsible and transparent. For example, it should not make unfounded statements about chances of winning, exert pressure to gamble, or suggest that gambling resolves social, professional, personal or financial problems.

Member States should ensure that training is provided to employees of online gambling operators interacting with players to ensure they understand problem gambling issues and are able to liaise with the players appropriately.

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Cooperation with Other Regulators AAMS & ARJEL agreement signed on 26 June 2011 First example of bilateral cooperation between gaming regulators

in Europe Exchange of market data, sharing of best practices to enable a

more effective consumer protection Specific attention is given to:

– Measures to prevent problem gambling– Blocking access of minors– Frauds related to payment systems– Money-laundering– Possible liquidity sharing for multi-player games (i.e. poker, bingo)

A larger group of regulators are meeting twice a year:Austria, Germany, Italy, France, Portugal, Spain, UK.

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Conclusions

Regulatory Cooperation• Fewer countries• Similar models• Continuous communication• Impact on daily activities• Exchange of “good” practices

• Works better in the short run• Small influence on national

political decisions

EC & Expert Group• 31 countries• Different approaches• 4 meetings / year• Impact on national frameworks• Exchange of “best” practices

• Medium run effects• High impact on national political

decisions (“recommendations”)

Higher level ofCONSUMER PROTECTION