Leading Italian online gaming network Microgame has revoked its French online sports betting licences before even launching in the market, blaming the failure of the French government to reform the tax system.
Microgame’s CEO and president Fabrizio D’Aloia (pictured) requested the repeal of the licences for PeoplesBet.fr and PeoplesNetwork.fr in a letter to French regulator ARJEL on 20 February. ARJEL confirmed this had been granted in a notice posted on its website yesterday, little more than a year after Microgame was licensed to offer online sports betting into the market on 24 February 2011.
The company said in a statement: “The online sports betting market in France has not met the expectations of society and is now in decline, as evidenced by data collected for the last quarter of 2011, which showed that it recorded a loss of 23% compared to a year earlier.
“The company has been waiting for requested changes to the taxation system by ARJEL to happen, changes the French Government has decided not to implement and, as already done so by many of the largest operators of online gaming, has decided to withdraw from the French sector. So as a result of lack of development of the market, [the company] has decided not to activate Microgame gambling sites [in France] and to request the revocation of the license from ARJEL.”
The effective tax rate of 8.5% on sports betting stakes in France, with no casino games to mitigate risk, has been blamed by private operators for the decline in the legal market highlighted by D’Aloia, by failing to provide sufficient value to players to bet on legal sites, also undermining the French government’s tax take. Operators also argue that the 85% payback limit introduced by French authorities is also failing in its stated aim of protecting the consumer.
Microgame however did not rule out a return to the a market at a later date, saying it would would continue to monitor regulatory developments around sports betting and poker.
Microgame owns the largest online poker network in Italy, its People’s Network accounting for close to 28% of the €24.65m receipts from poker ring games in Italy in January, according to calculations by Casino Choice based on data from Italian regulator AAMS. The People’s Poker Network is Caesars’ marketing partner for the World Series of Poker (WSOP) in Italy.
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