Betting exchange Betfair confirmed today that it is going to take legal action against the Italian government over recent measures, included in the 2006 budget drafted by Italy's Ministry of Economy, that prohibit foreign gambling Web sites' access to Italian Internet Service Providers (ISP).
Further, the law isn't just targeting the gambling companies. It also imposes a fine of between €30,000 and €180,000 (US$36,000-$215,000) on ISPs that fail to comply with the law.
The law, implemented today, blocked 684 online gambling sites from Italian ISPs.
Betfair's Director of Communications Mark Davies said today that Betfair, along with several other online gambling companies, are suing the Italian government with the backing of the Remote Gambling Association (RGA), which is an advocacy group for online gambling operators in Europe.
The concerned gambling companies, which reportedly also include Ladbrokes, William Hill, Coral Eurobet and SkyBet, believe the Italian government exhibited underhandedness when they passed the legislation without regard to European Union rules.
"We believe it's extremely clear that they haven't followed due process and, therefore, what they have done is issue a law which is in clear breach of European Law, which has supremacy over Italian law," Davies said. "We believe that if they had followed due process and notified the European Commission they would have been told that they couldn't do it."
The RGA and the European Betting Association (EBA), which promotes cross-border gambling businesses in Europe, filed a joint resolution Nov. 2, 2005 with the European Commission (EC) warning the Italian government that the legislation violates at least five laws embedded in the EC Treaty.
Further, the legislation contradicts the treaty as a whole, which is designed to promote an internal market and free trade within Europe.
Betfair and joint-plaintiffs are demanding the Italian government repeal the law. In the interim, they are taking them to court.