Lottomatica and Snai appeal gaming machine fines
Authorities seek 2.5bn from 10 Italian gaming machine operators for alleged contract violation.
Lottomatica and Snai are to appeal a combined penalty of more than 500m handed down by the Italian government’s audit department (Corte dei Conti) as part of a series of fines imposed on gaming machine operators for alleged contract violation from 2006 to 2008, it announced this morning.
The charges date back to a case brought a case against Italy’s 10 gaming machine operators by Corte dei Conti claiming a lack of compliance with 2004 regulations on information sharing between the companies and the Italian Ministry of Finance and the delay in a launch of a gaming management network. The eight other operators involved are Sisal, Cirsa, Codere, Cogetech, G.Matica, Gamenet, B Plus Giocolegale and HBG Gaming.
Snai released a statement confirming its decision to contest the penalty, stating it is confident of winning the appeal: “A full analysis is underway with the intent to evaluate the impact of the aforementioned judgement. Snai declares that it will file an appeal against this judgement to prove the correctness of its conduct, which could not result in any such responsibility. The submission of the appeal will determine the suspension as per law of the effects of the challenged judgement.”
Under the terms of gaming machines legislation, the 10 operators were required to have every machine connected to a gaming management network, designed to allow Italian regulator AAMS to monitor the amounts wagered and total paid out on each terminal in order to calculate the taxable amount each company was required to pay. Each company was also required to have connected to the network by the proposed launch date of 13 September 2004. However, from 2006 to 2008 none of the companies had allegedly given AAMS complete access to their gaming machines.
The legislation stated that operators were to be fined 50 for every hour each terminal was offline. As a result the Corte dei Conti originally sought a total of 98bn from the 10 operators with Lottomatica’s Videolot Rete subsidiary liable for 4bn, and Snai 4.8bn.
The figure has since been revised as an attempt to reach a compromise, with the Corte dei Conti now seeking a total of 2.5bn, with Lottomatica being ordered to pay 100m, and Snai 210m. Cogetech, acquired by Snai in December last year, is liable for 255m.
The lottery operator has contested the penalty, claiming there is no proof to the Corte dei Conti’s claims and that the amount sought is disproportionate. A further VLT operator, B Plus Giocolegale, also lodged an appeal to have the claim dismissed in November 2010.
This latest development in the case comes at a time when the Ministry of Finance is reportedly debating a change in the country’s egaming taxation. The ministry is thought to be considering proposals to change the current 20% tax on gross profit to a 1% turnover tax as part of a series of austerity measures prompted by the ongoing financial crisis in Italy.