By law, Australia's federal government will conduct a review this year of the Interactive Gambling Act, which was passed nearly two years ago. The Act put heavy restrictions on Internet casinos and sports books, putting an end to a period in which Australian states were the world's most progressive online gambling jurisdictions. Many industry experts feel the status quo will not remain after the review is concluded; either the government will open up to the industry or it will clamp down even harder.
Tim Ryan, a spokesperson with the Registered Bookmakers Advisory Council in Australia and an expert on Internet and e-commerce law, is among those who are worried that the outcome of the review will not be positive for the I-gaming industry.
We asked Ryan:
In which direction will Australia go when it reviews its interactive gambling policy?
 |
Tim Ryan:
"If the government persists with the Interactive Gambling Act, I believe they will look to plug some of the potential loopholes..."
|
|
Tim Ryan - I just can't see in the Australian political climate where there is significant anti-gambling sentiment in the community. At the end of the day, online gaming is portrayed as a "pokie in your lounge room" or a "blackjack table in the dining room," and despite some valid arguments that account systems provide for sound responsible gambling practices, the general mood in the community is less, not more, gaming. And if you want to do it, you have to go where it is physically permitted and regulated.
If the government persists with the Interactive Gambling Act (IGA), I believe they will look to plug some of the potential loopholes in the act and may be inspired by the recent High Court of Australia's Gutnick/Dow Jones decision on publishing and the Leach bill's progress in the U.S.
For example, we have had one instance last year of a U.K. spread betting firm getting around the IGA by getting a securities dealers license and promoting only financial instruments in the press. I expect that hole to be plugged.
I also expect that that the current exemptions for wagering, draw/ticket lotteries, promotions linked to television broadcasts and state-licensed physical gaming machines will be tightened up.
Most importantly I think, in keeping with developing opinion on that cross-border gambling is being used to weaken social policy, that all the exemptions (under the Act) will only apply to Australian state or licensed operators. This requirement nearly made it into the act 18 months ago, but missed out because of last-minute claims of "unintended consequences."
The "publishing" angle is interesting. Even in the U.K., where there is apparently a more liberalized approach to cross-border gambling, there are still prohibitions on gambling advertising by offshore operators. The focus has been on "above the line" advertising but, as the whole world swings more and more to "below the line" or direct marketing--and e-mail/ SMS etc. rises more and more to be the advertising "medium of choice"--those mainstream bans will be an increasingly useless tool to stop leakage as lists are traded without respect to domicile of the recipient. The Gutnick "published-where-it-is-read" precedent makes it easier to say "don't send it to Australians," period.
The flow-on is even more interesting. Such an approach would make it easier to address good-Neighbor requests; that's even if they are necessary as one (worst case) possibility is that the exemptions may be only to supply the exempted services to Australian residents (as permitted by state and territorial laws).
I just don't see gambling as a "free trade" issue--proponents do, but they would--but for mine that is denying the obvious: When it comes to gambling, the real costs are injected by legislation. Look at our totalisator operations: Nearly 60 percent of the takeout (or punter expenditure) is tax or industry levy.
If anything, the intervening 18 months have allowed new technologies--for example, Quova's geolocation services--that appear to have shattered the illusion that the Internet is borderless.
Certainly Australian racing is girding its loins for battle on this front and is acting in concert with other racing jurisdictions to develop a consistent international policy on cross-border wagering for racing at least. The lottery groups are similarly minded.
Let's face facts. In the absence of respect for jurisdictional integrity--and the legislative support/protection racing receives as part of a net public benefit test--racing faces a bleak future as offshore gambling operations rape and pillage both the racing product and the punters betting on it with tax/levy advantages that the state licensed and regulated incumbents cannot match. This is a "race to the bottom" and racing would be decimated.
There are a few upsides to these likely changes. If the requirement to hold an Australian state or territory licensee or authorization is included, perhaps a few loose ends, such as betting-in-the-run on sports, may be relaxed. As it stands the Federal Minister and his department have neither the skill base nor the resources to administer the regulatory environment on a day-to-day basis, but the government may feel more relaxed if it was in state/territory hands.
A bleak picture? Depends on your perspective. Perhaps my view reflects a maturing of the technology and the environment. I think the future still holds great promise for online gambling, particularly wagering, as it's a cost-efficient distribution channel.