A new effort to regulate New Zealand’s eagerly awaited online casino market has cleared its first hurdle.
The Bill, introduced by Minister of Internal Affairs Brooke van Velden, passed its first reading in Parliament yesterday (15 July) which marks a significant shift toward stronger oversight and safer gambling practices in the region.
Earlier this month it was revealed that 15 online casino licences will be auctioned off, which raised some concerns among some industry stakeholders about potential market disruption and risks to player safety.
Player safety concerns
A bidding process is expected to draw significant international interest given New Zealand’s strong economy. The proposed legislation seeks to work alongside this and establish a robust licensing and regulatory framework for online gambling platforms operating in the country.
With online gambling increasingly popular and easily accessible, worries have developed over the absence of local protections for players and the lack of accountability from offshore operators.
However, Van Velden explained: “My intention with this Bill is to ensure that online gambling is safer for New Zealanders who wish to gamble online to do so. In addition, that companies providing this service contribute to tax revenue and funding the services that treat gambling harm in New Zealand.”
The government has been working on this process for a while, having been aiming to launch the market by 2026.
Additional reforms
It was announced in June that TAB NZ – operated by UK-based Entain – will now be the only legal provider of online sports betting in New Zealand.
This followed changes to the Racing Industry Act 2020, which have become law after receiving Royal Assent. As a result, all other companies offering online betting on horse racing and sports must exit the New Zealand market.
Entain recently told SBC News that it mostly supports the upcoming expansion, however local reports suggest that market incumbents have some doubts. This includes TAB NZ, which has at times expressed a more concerned viewpoint than its betting partner Entain.
In TAB’s letter to the racing Minister, company CEO Nick Roberts said: “There could be severe implications for TAB NZ if this fast-growing online casinos market cannibalises our existing operations by being legitimised in NZ in an open market context.”
“Settings that create an open market would allow for multinational domination over NZ’s existing operators, establishing an unsustainable model for traditional gambling products, and risking our ability to appropriately fund racing and sport – all while driving gambling profits offshore and delivering worse harm outcomes for Kiwi consumers.”
To be eligible for bidding for the 15 new casino licenses, operators must meet stringent requirements, such as outlining a comprehensive harm minimisation strategy and providing detailed records of their past regulatory compliance.
The Department of Internal Affairs will be responsible for overseeing the new regime, van Velden explained, and all regulatory costs will be recovered from fees levied on licensed companies.
The country has warned that in cases of non-compliance, operators could face penalties of up to $5m. In the case of the sports betting market, companies like Betfair exited the market quickly after the Racing Act amendments were approved, and the government is now moving to set similar parameters on the casino space.
“The most important part of this Bill is protecting New Zealanders who enjoy gambling online by introducing robust safety measures for licensed operators,” van Velden continued.
As the Bill moves to the select committee stage, van Velden is encouraging public participation in the legislative process. She said: “The Bill will now proceed to the select committee, and I would encourage interested New Zealanders to have their say when public submissions open.”
As the Bill heads into the next phase, where it will be assessed by a parliamentary select committee, stakeholders across the gambling, racing and tech sectors will be watching closely to see how its framework develops.
The upcoming months will be key in determining how New Zealand balances innovation, market access and customer protection in its growing online gambling space.
