As an Italian with little interest in watching soccer (pirated or not), I have just read AGCOM's decision and it provides a bit more context (although with typical legalese language):

- right holders used the piracy shield platform to report Cloudflare-owned IP/FQDNs used for piracy streaming

- Italian anti-piracy law mandates that "IT service providers" (rough translation) have to comply with AGCOM orders by enforcing blocks at the DNS or IP level or with other technical or organizational measures

- in 2024, AGCOM told Cloudflare to appoint someone in charge of these matters, highlighted that a lot of piracy websites use Cloudlfare, and invited Cloudflare to join itself the piracy shield platform

- again in 2024, following additional notes explicitly sent to Cloudflare (apparently via snail mail, but I guess it's for legal reasons) and published on AGCOM website, AGCOM also invited Cloudflare to join the "Technical Board" of Piracy Shield, basically the forum where ISPs discuss technical aspects of how Piracy Shield is actually implemented

- in 2025, AGCOM told CF to block certain IPs. CF didn't reply and AGCOM checked that those IPs were not blocked (surprise? I guess?), so AGCOM formally told CF they were violating the law. AGCOM also asked CF and Guardia di Finanza (Italian police specialized in fiscal/financial matters) to report CF's European and Italian sales figures. CF gave these data (which are redacted in the public AGCOM document).

- CF replied with a long list of observations, essentially saying that 1) CF hasn't joined piracy shield so they don't know which IPs should be blocked, 2) there is a pending hearing at the TAR (the court responsible for complaints against government/public entities/regulators decisions), 3) CF has no technical way to "know, control, modify or interfere in any way" with the content published by its customers, 4) even if blocked by CF the website is still online, 5) setting up a DNS filter will be very complicated and will impact performance (latency)

- AGCOM argued that 1) yes, CF hasn't joined piracy shield but it also didn't accept the invitation to join its technical board and, anyway, when it asked CF to block certain IPs it actually listed them, 2) AGCOM is not accusing CF of violating copyright laws, but of not complying with these piracy shield measures and, because CF actually didn't block those IPs, there is no need to wait for the other court hearing. In addition, other court hearings have considered CF responsible when illegal websites are hosted using its services, because of the reverse proxy service (basically, the CDN itself) and the fact that CF services can optimize performance and allow users to reach a website even when it's blocked (I think they're talking about their 1.1.1.1 DNS), 3) over 11 years, CF received a lot of notes from AGCOM because of domains hosted/protected by CF, but never challenged them, and in many cases CF was acting as reverse proxy for these domains (surprise?) 4) blocking these resources is mandated by law, and that resources not hosting illegal content anymore have been "unblocked" in the past, 5) CF has the technical knowledge to set up this kind of filters and should be organized to be able to comply with various laws and regulations.

I think this gives a bit more nuance. By the way, personally, I would argue that it's not true that CF has no technical way to "know, control, modify or interfere in any way" with the content, precisely because it acts as a giant reverse proxy/MITM. Arguing about the validity of this law (although the law was written by the parliament) or its implementation is one thing, but claiming that a CDN has no technical way to block resources seems a bit naive.