The Australian Senate passed a bill on Tuesday that will further restrict sports betting operators from offering in-play betting.
The Interactive Gambling Amendment Bill 2016 for the first time would make it illegal for unlicensed operators to offer online poker or gambling. The bill includes several provisions that enhance the regulator’s powers to take action against such offshore operators.
In addition, the government will have the power to determine what is or is not a sporting event. That definition is what makes a sport eligible for betting.
The text of the Interactive Gambling Amendment Bill is available here.
Click-to-call technology has made previous law obsolete
Under the current law, in-play betting is already illegal, but sports betting operators taking customers in Australia have been able to partially circumvent the restriction by using automated telephone betting.
The Interactive Gambling Act 2001 banned in-play betting unless bettors placed wagers by telephone. The intention of the provision was to reduce the risk of problem gambling.
Bets placed by telephone were assumed to involve a conversation with a representative. They would involve identity checks and provide details of the bet to be placed. Lawmakers assumed the slowness of the process to be sufficient to reduce the risks to problem gamblers.
Since 2001, operators have developed “click-to-call” technology to the point where sports bettors can place almost completely automated bets by mixing website data entry with computerized telephone systems.
How the bill stops in-play betting
The outline to the bill explains:
“These services currently involve a consumer inputting betting information using a website or a mobile device application, which activates a call to a computerised voice that repeats the consumer’s proposed bet and asks the consumer to confirm the bet by pressing a button on a website, application or keypad. The process can be completed in a very short period of time.”
The new law redefines the use of a telephone betting service. It insists that the call consists of “a spoken conversation (or an equivalent for a customer with a disability).”
Mixing voice and data input over the internet will be almost entirely illegal:
“A service whereby any or all of certain information about the bet being placed can be provided by the customer to the operator otherwise by way of a voice call, for example through clicking or pressing an icon or entering betting information via a website, keypad or application, is not a telephone betting service for the purposes of the IGA.”
There are some minor exemptions to the restrictions for the use of customer identification and the use of tone call technology for call waiting and automating menus.
The Minister for Communications will determine what is a sporting event
The bill gives the Minister for Communications the power to decide whether a particular event is classified as a sporting event.
This should lead to more clarity and may also impact on whether newer sports can be included as sporting events. It is unlikely that esports are likely to be included in the definition for the immediate future, but the possibility is now there.
“Sporting events and betting markets continually evolve both in Australia and overseas so it is also necessary that specific rules can be developed in a timely fashion for new forms of a current sport or new sports. Allowing for the making of legislative instruments on this matter enables direction to be provided while allowing sufficient flexibility to deal with change.”
Esports betting in Australia is not permitted at the federal level. Two states have introduced their own gambling regulations that permit betting on esports tournaments — the Northern Territories and Victoria.
Of more immediate interest to sports betting operators is that one aim of devolving the power to the minister is to avoid artificial definitions that allow in-play betting.
The bill outline explains that operators have claimed that “parts of sporting events, such as the innings of a test cricket match, are sporting events in their own right.”
The minister will be able to rule directly on these issues. There will be no need for legal action to rule on the definition.
Officials in the UK have made the case for regulating, not banning, in-play betting.
Australia will deter offshore operators but not defeat them
Prior to this bill, there was no specific prohibition on offshore operators from offering services in Australia.
There is no licensing system for online poker in Australia. But operators such as PokerStars and 888 have been able to compete in the market without fear of prosecution.
The new bill changes the situation entirely. 888 has already exited the Australian market. PokerStars is likely to follow when the bill becomes law.
The bill now splits gambling into two types — legal and illegal:
“Prohibited interactive gambling services (‘illegal services’) and regulated interactive gambling services (most of the current excluded services) – and include new provisions prohibiting a person providing regulated interactive gambling services to Australians unless the person holds a licence under the law of an Australian State or Territory (‘unlicensed regulated interactive gambling services’)”
Australian regulators gain power
The Australian Communications and Media Authority is being given new powers to act against unlicensed operators.
When the bill passes, the ACMA will gain powers of:
- ISP blocking
- The imposition of civil penalties for offending operators
- Powers to the immigration department to disrupt the travel of directors of offending gambling companies
- The provision of authority to the Australian Communications and Media Authority to disclose information on offending operators to other national regulatory bodies
- The creation of a blacklist of unlicensed operators
For the law-abiding licensed operators such as Bet365 and William Hill, there will be some relief from offshore competition. However, Australia has little enforcement power over the activities of offshore operators. The impact is likely to be minimal.
The bill now goes to the House of Representatives, where lawmakers will vote on it shortly. There is more than sufficient support for it to pass, and it should become law within a couple of months.