Meta's Facebook and Instagram hit with fines in Italy over gambling ads

Italy has continued to strike against tech companies behind some of the most recognizable social media in the world, penalizing breaches of the country’s strict and uncompromising ban on gambling advertisements.

The latest company to be targeted in an enforcement move is Meta Platforms, the parent company of Facebook, which has been similarly found to infringe on the established gambling laws in the country and to have allowed gambling content to be seen on its social media platforms.

The country has responded by slapping a €5.85m ($6.45m) fine because of breaches across both Instagram and Facebook, which are owned by Meta. This ruling was confirmed by the Autorità per le Garanzie nelle Comunicazioni (AGCOM) last week, with the regulator recently taking a similar action against YouTube and Twitch, and their respective parent companies, Alphabet Inc. and Amazon.

Yet, the penalty issued to Facebook is much greater than the €3.15m ($3.50m) slapped on both companies earlier this month. Further details about the exact nature of the offense are scant, but it usually concerns allowing prohibited content to appear on the platform.

In other words, Facebook and Instagram were not quick enough to act against account holders who promoted gambling materials on the Italian market. Although the companies are not themselves purposefully pushing gambling on Italian customers, their customers may be.

In such cases, AGCOM considers itself to be the operating or owner company at fault, hence the penalty. Italy has buffeted digital giants with penalties since 2018 when the Dignity Decree, effectively prohibiting all advertising in the country, was first introduced.

Yet, this is not the only big regulatory change that is afoot in the country. In fact, Italy is debating whether to increase the current rate of taxation on the gambling sector in a bid to boost tax revenue. A newly proposed bill is aiming to do just that.

This has elicited a strong response from industry groups and the European Betting and Gaming Association (EGBA), which remarked that should the new law be passed, it could easily see many businesses close down. This would in turn kill the competitiveness of the market. The Association noted that there is a way to regulate the market and increase taxes but in a fashion that would not harm its competitiveness.

Italy is yet to respond to this. In the meantime, Meta Platforms may choose to challenge the penalty issued against it, and possibly defeat it, like Alphabet’s Google did recently.

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