Aussie Senate Gets It Done

28 June 2001
After today's marathon debate and weeks of political compromise and intense public argument, the Australian Senate passed the Interactive Gambling Bill by a vote of 33-28.

The bill may have passed through the Senate, but the country's leading operator may mount a court battle to oppose the move.

The bill, as passed, bans Australian-based Internet gambling sites from providing services to Australians and to all countries opposed to the sites. Exemptions, however, allow sites offering horse and sports betting as well as online lottery sales to continue operating.

The final vote on the bill came after the Senate debated the issue for much of the morning before procedural rules forced the debate to be tabled. The Senate moved on to other business, but later returned to debate the bill and the numerous amendments added in recent weeks.

A sense of urgency had risen among supporters of the bill as the Senate was in its last day of session before a long winter break.

After wading through dozens of amendments, the Democrats split on the final vote, with senators John Woodley, Meg Lees and Lyn Allison voting for it and the other six against it. It was those six, along with other middle-of-the-road legislators like Greens Senator Bob Brown, who helped the bill get passed in the Senate.

Labor strongly opposed the bill, claiming that the government failed to address existing gambling problems in its bid to curb Internet gambling.

Labor Senator Mark Bishop said that amending the bill was futile and it was not technically feasible to ban interactive gambling. Instead the government should support state-based regulatory regimes, he argued.

"(The government) tries to distinguish between those unfortunate souls who might be addicted to casino-type gambling, from those unfortunate souls who have been addicted for many, many years, on wagering or sports betting or racecourses," he said. "For God's sake, what's the difference? It's like saying an alcoholic who's addicted to gin is different to an alcoholic who's addicted to whisky."

Although the federal government was able to claim a small victory in the Senate on Thursday, Lasseters Online, Australia's only operating Internet casino, said the war is far from over.

Peter Bridge, the online managing director for Lasseters, said his company is looking into filing a lawsuit against the legislation and may even file a complaint with the World Trade Organization on grounds that the bill restricts virtual casinos from growing internationally.

The federal government isn't settling for just banning online casinos. The government is expected to attempt getting Australian credit cards banned from being used at foreign online casino sites. Such a move would require the cooperation of Australian banks, and it is believed the industry would be against policing customers' expenditures.

In a statement released after passage of the bill, Bridge said the restrictions placed on companies like Lasseters could be in violation of both Australian and international law.

"Our understanding is we may have a claim for compensation under a High Court challenge," he said. "It may also be subject to action through the World Trade Organization given it restricts our right to trade."

Bridge fired some shots at a government which just four years ago was on the cutting edge of a burgeoning Internet industry but now, he feels, is taking steps backward.

"Australia set the global benchmark in online gaming regulation, and the world has been looking to us for leadership on this issue," he said. "With all the exemptions and amendments to this bill, we have failed them. Many developed nations are moving towards regulation of online gaming so this amendment actually runs against the global trend."

Bridge feels if the same standard was used in the bricks-and-mortar world land-based casinos would have far less visitors than they do now. Tourists in Australia from countries prohibiting gambling would be banned from entering casinos, clubs, pubs and horse tracks.

"This will never happen because of the serious impact on our tourism industry," he said. "So why try to do it in the virtual world? It makes no sense."

The Australian Casino Association maintained its adamant opposition to the bill even after it was passed. The ACA's top executive Chris Downy feels the ban is useless. "The government's legislation is a waste of time," he said. "Australians will still access overseas operators because the legislation's provisions to stop this are nothing more than window dressing."

Communications Minster Richard Alston said the amendments added to the bill prior to its passage were necessary to give the bill some added weight.

"Amendments moved by the government and supported by the Senate have addressed the concerns expressed by the community," he said in a statement after the vote.

Democrats Woodley, Allison and Lees said in a statement that the amendments were enough to get their support for the bill.

"One of the key criticisms of the government's legislation was that it only banned Australian sites operating in Australia and failed to protect overseas countries," the senators stated. "This has now been addressed. Other key commitments given by the government address our concerns about the social impact of gambling, including a budget allocation of $10 million over four years for research and an education program into social problems associated with gambling."

Brown promoted the extension of the ban to certain designated countries by making it an offense to provide Australian-based gambling services to those nations.

"What's bad for Australian households is bad for households elsewhere around the world," he told the Senate.

Senator Brian Greig, a Democrat, argued, however, that Australian services affected by a ban on certain countries would simply move offshore to get around it.

"Australian companies could still locate themselves in a country where there was no prohibition, such as Vanuatu, and continue their services into those countries," Greig said. "So the argument to me is nonsense."

Bridge concluded that international cooperation will be hard to come by in enforcing the ban.

"There is no country in the world that currently has the standard of legislation required to comply with the proposed amendment," he said. "All that will happen is the black market for unregulated online gaming will grow and online players will have no chance of having their rights protected."