Google Facing Italian Probe Over Potential Ad Ban Breach
The Italian communications authority AGCOM has refused to close an investigation into Google over allegations of an ad ban breach. The search giant is accused of breaking the country’s outright ban on gambling advertising
Further investigation into Google, over a suspected breach of gambling-related advertisement laws, will continue, after the Italian marketing regulator, AGCOM refused to halt proceedings against the company.
The regulator is investigating companies including Google Inc., Google Ireland Limited and Google Italy Srl, for displaying search results that contain advertisements for overseas gambling companies.
However, legal representatives, including multinational law firm DLA Piper believe any action against Google and associated companies could fail if the company cites intent as a defence. Partner Giulio Coraggio said: “If the Google search results are merely informative, do not contain any call to action, and merely outline the features of operators’ offerings, the Italian gambling advertising ban shall not apply according to the terms of the AGCOM guidelines.
“Once again, the ban cannot prevent companies from operating and from informing their customers about their services. The outcome of the AGCOM investigation against Google is likely to be a showdown for the Italian gambling market.
“If some further exceptions to the applicability of the ban are identified, they could lead to a reshaping of operators and affiliates’ strategy.” Italy introduced a blanket ban on gambling advertising that came into effect in June 2019. Introduced by the country’s newly-appointed coalition at the time, the decree introduced rules which outlawed all forms of advertising of gambling products and services across all platforms.
The media outlets affected include television, radio and sporting events, including sponsorship of football teams. Importantly for this case, the decree also included online advertisements. This latest conflict with the regulator is not the first time that Italy’s Dignity Decree has caused issues for the Silicon Valley company. In 2018, Italy’s regulations caused Google’s listings to remove all licenced operators, leaving only unregulated online operators listed, causing them to climb up search result listings.
Events in Italy are likely to be watched with interest in Spain, a similar ban on sponsorship is currently waiting for Royal Decree and is in the process of being assessed by European authorities.
The Italian ban is likely to prove costly, Simone Cadeddu, partner at Bird & Bird said: “If the ban is confirmed in its entirety, the State, gambling operators, media operators and advertising agencies would be significantly affected. Adding: “The Italian specialised news agency, AGI, predicted a €700 million income decrease over three years for public finances, accompanied by at least a 2% reduction in gambling expenditure and a negative impact on national TV (loss of €70 million) and advertising media owners (loss of €130 million divided between soccer teams, radio and local TV).”
In Italy, the impending ban led to gambling companies signing long-term deals with football clubs, hoping to circumnavigate the rules. For example; Betway agreed on a three-year deal to sponsor AS Roma, despite Di Maio alleging that advertising contracts entered by gambling firms following the publication of the degree and its enforcement would not be valid.
Spanish football clubs have in recent months, seen a large increase in the number of new sponsorship deals or the existing extending deals; this is a pattern that occurred in Italy post-ban. In England, gambling companies agreed to stop all TV and radio advertising for games and products during the virus lockdown; this agreement has ended with the easing of restrictions.