Kyleria Epidemic Spreads to Australia

21 August 2000
The march toward prohibition continues in Australia as legislation has been introduced before Parliament to enforce a moratorium on the issuing of new interactive gaming licenses. The legislation, known as the Interactive Gambling (Moratorium) Bill 2000, calls for a 12-month freeze on licensing while the government conducts its own extensive study into the feasibility and consequences of banning interactive gambling.

When the moratorium was first announced in May, most Australian state and territory governments rebelled, claiming that the federal government was overstepping its bounds. The standoff resulted in federal government officials drafting a lengthy explanatory memorandum. In it, the commonwealth government points out that "new interactive technology, such as the Internet and datacasting, has the potential to put a virtual 'poker machine' in every home."

Under terms of the new legislation, any company that wants to avoid being closed down by the moratorium must prove that it provided interactive gambling services prior to May 19, 2000. Operators must also prove that current services are the same or substantially the same as the service provided before May 19, 2000 and that those services were provided under the same name as the service provided by that date. Additionally, each operator must show that there was at least one arm's length paying customer before May 19, 2000.

The bill excludes telephone betting, futures trading and online share trading and other activities not considered gaming and wagering under the Corporations Law. Australian ISPs will not be held liable for providing interactive gambling services, unless it's deemed the ISPs are providing the content of the gambling site. Likewise, ancillary services, such as bill payment companies and credit providers, aren't liable under the bill unless such companies provide content for the gambling sites.

Next Generation Gaming's Anthony McAuslan called the moratorium "inept and heavy-handed." He explained, "Instead of opting for a simple ban on taking bets from Australians--which would have the most immediate positive effect for problem gamers and would have the least economical impact on existing operators--the government has instead opted for a draconian approach that merely stifles investment and makes us the laughing stock of the information economy. . . . The government has merely chosen to restrict the activities of local operators while leaving the Australian population free to wager on any of up to one thousand offshore gaming sites operating in less regulated markets such as the Caribbean."

"It's difficult to find anything good to say about this document (the bill)," complained consultant Jon Moss. "Not only does it stop new casinos opening, but prevents existing one offering new games and even sports bookmakers offering new events."

Penalties ranging from A$220,000 to A$1.1 million will be imposed on companies contravening the moratorium.

Click here to view Interactive Gambling (Moratorium) Bill 2000.
Click here to view Explanatory Memorandumis.