The regime applicable to affiliates under Italian gambling law has never been subject of thorough reviews maybe because of the difficulty to enforce Italian court decisions against foreign websites. However, such conduct is regulated and the applicable sanctions are considerably high.
The general principle is set forth in Law 13 December 1989, No. 401 prohibiting the advertising of gambling websites run without an Italian gambling license issued by AAMS or offering games that are reserved to the Italian State. The breach of this obligation is sanctioned with the imprisonment up to 3 months that is increased up to 1 year in case of advertising concerning gambling websites offering lottery tickets or similar games of chance of foreign countries.
Italian law prohibits the offering of games remotely without an Italian license issued by AAMS to people located in Italy and sanctions such conduct with the imprisonment up to 3 years. As a consequence of that, the above mentioned provisions have also been introduced to avoid any advertising practice involving non-Italian licensed websites directed to people located in Italy.
But what are the criteria of applicability of these provisions in the case of foreign websites? Italian criminal law applies the principle of territoriality which makes reference to both the place where the illegal conduct took place and to the place where the effects of such illegal conduct occurred. As a consequence of that because of the ubiquity of the Internet a foreign affiliate website that advertises non-Italian licensed websites might face the above mentioned criminal sanctions.
Despite the fact that there is no case law on disputes involving affiliates, the conclusions above are even more grounded if there is a version of the affiliate website in Italian. In such case, given that the Italian language is mainly spoken only in Italy, the affiliate website might be deemed to be "targeted" to Italian players and therefore falling under the scope of Italian criminal law.
The above is confirmed by the circumstance that a number of affiliate websites are in the blacklist of illegal websites published by AAMS and in relation to which Italian Internet Service Providers (ISPs) are obliged to implement filters preventing people located in Italy to get access to such websites.
This is due to the fact that affiliate websites are often used by non-Italian licensed gambling websites to circumvent the filters put in place by Italian ISPs through a banner which links to a website whose domain name is slightly different from the one of the main gambling website of the operator.
Indeed, despite the considerable efforts performed by AAMS to keep its blacklist up-to-date, operators change their domain name very frequently generating new domain names that are not listed in AAMS blacklist that are redirected to their main website. However, in order to notify the new domain name to players, they use banners published on affiliate websites.
This practice is even more risky for affiliate websites since they might be deemed to be contributory liable in the crime perpetrated by the operator. In such case the potential sanction would increase from 3 months or 1 year (depending on the games offered on the advertised website) to 3 years which is the sanction applicable against non-Italian licensed online operators offering games to people located in Italy.
Given the above, affiliate websites might become cautious in advertising to the benefit of Italian residents non-Italian licensed websites also because the checks on such websites might become more and more aggressive because of the pressure that Italian licensed operators (which now include most of the major gambling operators) are putting on AAMS to foster more stringent checks and actions against them.
Need to know more on the above? Feel free to contact me, Giulio Coraggio (giulio.coraggio@dlapiper.com).
Posted by Giulio Coraggio on Tuesday 07 Feb 2012