Review of Illegal Offshore Wagering

Illegal offshore wagering presents serious risks to Australia. It puts individuals at risk because legal and standard consumer protections are absent. Sport and racing integrity is at risk due to limited access to betting and transaction information. There is also lost taxation revenue for governments and fees for sports bodies and less revenue and jobs for Australians.

On this basis, and consistent with the election commitment to help problem gamblers, the Government commissioned the Review of Illegal Offshore Wagering (the Review) on 7 September 2015 to investigate the size and scope of the illegal offshore wagering problem and advise on ways to strengthen our regulatory enforcement and protect Australians.

The Review, led by the Hon Barry O’Farrell, consulted widely with state and territory governments, industry, community support services, Government departments and academics and also heard the personal submissions of individuals affected by problem gambling.

Mr O’Farrell provided his report to the Government on 18 December 2015.

The Government has accepted in full or in-principle 18 of the Review’s 19 recommendations and noted one. Based on the Review’s recommendations, the Government proposed to:

  1. Establish a strong national consumer protection framework (details below).
  2. Crack down on illegal offshore gambling providers by:
    1. Amending the law to make it clear that it is illegal for overseas gambling companies to offer gambling products to Australians; and empowering the Australian Communications Media authority (ACMA) with civil penalties to enforce the law.
    2. Introducing other disruption measures to curb illegal offshore gambling activity, such as placing company directors of illegal offshore companies on the movement alert list.
  3. Clarify the law by prohibiting ‘click-to-call’ in-play wagering services to respect the original intent of the Interactive Gambling Act 2001.
  4. Not expand the online betting market in Australia by legalising in-play betting.

Progress

The Commonwealth Government has successfully implemented the first stage of the Government’s commitment through Royal Assent of the Interactive Gambling Amendment Act 2017 (the IGAA). The IGAA came into effect on 13 September 2017.

The Commonwealth is in the final stages of agreeing a strong national consumer protection framework (see details below) with state and territory governments, after 18 months of intensive consultation on options.

The feasibility of other disruption measures, including Internet Service Provider blocking and financial payment blocking, is also being currently assessed and a position is expected mid 2018.

Amendments to the Interactive Gambling Act 2001

The amendments to the IGA, which were passed by the Parliament on 9 August 2017, are now enacted in the Interactive Gambling Amendment Act 2017. This makes it clear that it is illegal for unlicensed gambling companies to offer gambling products to Australians. The changes also clarify the IGA to respect its original intent, and make it clear that ‘click-to-call’ in-play wagering products are not permitted to be offered to Australians. Additionally, two measures which form part of the National Consumer Protection Framework (details below), banning lines of credit being offered by online wagering providers and prohibiting links between payday lenders and online wagering providers, have been legislated for through the amendments to the Interactive Gambling Act 2001 (the IGA). These measures came into effect on 17 February 2018.

Further, the ACMA has been given stronger enforcement powers, including through new civil penalty provisions. The Government is also looking at the feasibility of introducing other disruption measures to curb illegal offshore wagering, including voluntary Internet Service Provider and payment blocking.

These reforms aim to significantly disrupt the illegal offshore wagering market, shift users to licensed and regulated operators and potentially encourage illegal offshore operators to license onshore. This will then have flow on benefits to sports and racing integrity, and allow for better consumer protection for Australians.

The ACMA now reports on any complaints, breaches and investigations in relation to the IGA. For further information, visit the ACMA website.

National Consumer Protection Framework

The core of the Government’s response is establishing a strong, consistent and best-practice National Consumer Protection Framework (National Framework) for online wagering in Australia. The National Framework will include ten measures to empower individual gamblers and ensure the harm from online wagering is minimised.

The National Framework is intended to apply broadly to all forms of online wagering services which are not prohibited under the IGA. This covers wagering by any remote telecommunication service — primarily internet and telephone. In practice, online wagering is generally synonymous with account-based betting.

Commonwealth, state and territory gambling ministers have met on three occasions to progress the National Framework — on 25 November 2016, 27 April 2017 and 8 September 2017. See media releases and communiqués from the meetings below.

The measures include:

  1. A national multi-operator self-exclusion register (NSER). This will allow consumers, particularly those at risk or already displaying signs of problem gambling behaviour, to cease their online wagering activity for a specified period of time.
  2. A voluntary opt-out pre-commitment scheme. This will allow consumers to set limits on their online wagering activity.
  3. Ensuring the offering of inducements is consistent with responsible gambling. It has been suggested that some wagering inducements, such as sign-up offers, are likely to maintain or exacerbate harmful betting behaviours. The aim of this measure is to ensure wagering inducements are consistent with responsible gambling.
  4. The provision of activity statements for online wagering on demand and on a regular basis. This will allow consumers to readily track their wagering spending and behaviour.
  5. More consistent gambling messaging. The aim of this measure is to use national consistent messaging to assist efforts in responsible gambling for online wagering.
  6. Staff training in the responsible conduct of gambling. This measure will require staff to undertake training on the responsible provision of gambling services in the context of online wagering environments.
  7. Reducing the current 90-day verification period for customer verification to open a wagering account. Quicker age and identity verification processes would be expected to reduce the potential harms associated with underage online wagering and consumers operating under false names for purposes such as match fixing and avoiding self-exclusion.
  8. A clear and simple process for account closure. This enables consumers to easily close an account at any time, as the process should be transparent, simple and accessible.
  9. Banning lines of credit being offered by online wagering providers. This is to prevent the accumulation of debt, through betting with credit, potentially beyond the means of the customer to repay.
  10. Stopping the links between payday lenders and online wagering providers. This will ensure that consumers who are account holders with online wagering operators are neither targeted, nor made aware of payday lenders via online wagering operators.

The National Framework has been informed by an intensive 18 month consultative process involving the online wagering industry, sporting bodies, academia, the community and financial sectors, broadcasters and individuals impacted by gambling harm. This included consultation through a Council of Australian Governments (COAG) Consultation Regulation Impact Statement to canvass the regulatory and non-regulatory options for the National Framework to assist with the final decision making by Commonwealth, state and territory gambling ministers.

It is expected that all governments will endorse the National Framework by mid 2018.

Commonwealth, state and territory ministers agree to stronger online gambling protections

At the third meeting on 8 September 2017, ministers reaffirmed their commitment to ensuring greater protection for Australian’s gambling online and to the final stages of the establishment of a strong, consistent and best practice National Framework.

Media release and Communiqué from meeting

Ministers agree to tackle major online gambling reform

At the second meeting on 27 April 2017, the Government reached in-principle agreement with state and territory ministers to introduce broad reforms to provide stronger consumer protections in online gambling.

Media release and Communiqué from meeting

Ministers meet for the first time

Commonwealth and state and territory ministers with responsibility for gambling met in Melbourne on 25 November 2016 to progress the Australian Government’s Response to the Review of Illegal Offshore Wagering.

Ministers agreed that more can be done to ensure safer online wagering for Australians and agreed to continue working together towards the establishment of a National Consumer Protection Framework for Online Wagering.

Communiqué from meeting

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