Italian Lotto license tender to the European Court of Justice

Italian Lotto license tender to the European Court of Justice

The award of the Italian Lotto license will have an unexpected follow-up before the European Court of Justice with an uncertain outcome.

One of the main events in the Italian market in 2016 was the award of the Lotto license against the payment of € 700 million for 9 years.

However, the Italian licensing regime providing for the award of a single Lotto license has now been challenged by Stanleybet, and the Italian Supreme Administrative Court decided to refer the matter to the European Court of Justice (ECJ).

The Lotto licensing regime referred to the ECJ

The ECJ shall decide on whether it is compliant with EU principles of freedom of establishment and of providing services as well as of the principles of non-discrimination, transparency, freedom of competition, proportionality and consistency

  1. The single Lotto license regime;
  2. A call for tenders which provides for a minimum auction price disproportionate, if compared to the required economic, financial and technical organisational capabilities provided by the Lotto tender rules; and
  3. A rule requiring the imposition of an alternative between becoming an assign of a new license and continuing the betting activity currently performed by Stanleybet in Italy.

The potential outcome of the dispute

Given the value paid for the Italian Lotto license, this is a very delicate dispute to be followed. Also, the question is whether such dispute will have an impact on the tender for the Superenalotto license that is expected to be launched over the course of 2017.

Arrangements functional to the financing necessary to participate to the tender (e.g. bonds) shall take into account the uncertain potential follow-up that could affect the ability to pay back the amount of the financing.

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Source: Italian Lotto license tender to the European Court of Justice