A general introduction to gambling law in Australia
Authors: Daniel Lovecek - Principal, Alexandra Hoskins - Principal, Alex Norrish - Senior Associate
Overview
Definitions
Although it is difficult to provide an all-encompassing legal definition of gambling in Australia, generally speaking, gambling is defined as an activity that involves staking money or something of real-world value on the outcome of an event that is determined in full or in part by chance, such as a sporting event or a horse race, with the intent of winning a prize or something else of value.
Gambling regulation in Australia also extends to apply to 'trade promotions' (often referred to in other jurisdictions as 'sweepstakes'), being free-to-enter competitions for the promotion of trade. While these activities are generally permissible, subject to compliance with requirements concerning factors such as draw integrity, publication of results, eligible prize types and others, some Australian states and territories require the promoter to first obtain a permit from the relevant regulator.
Gambling policy
In Australia, there is a general prohibition in all jurisdictions on the conduct and promotion of gambling. Legislative exemptions exist for gambling activities that are conducted under a licence.
These activities include:
lotteries (both in venue and online);
wagering and sports betting (both in venues and online);
electronic gaming machines, slot machines, or 'pokies' (just in venues); and
land-based casinos where casino games, including poker, baccarat, and blackjack (among others), can be played.
The paternalistic approach to the regulation of gambling services by Australian federal and state governments is a response to the concerns that arise from the adverse social consequences associated with gambling. However, gambling has long been a part of Australia's culture and identity and, together with racing and sport, is well established in the national consciousness. State- and territory-based regulation of gambling in the early 20th century marked the beginning of the legislative regime in place today. With the introduction of online wagering in the late 20th century, the industry continues to flourish, despite the continuing conflict between the economic returns provided by the gambling sector to state and territory governments, and sporting and racing bodies and the pressure for governments to take action to minimise problem-gambling behaviour.
State control and private enterprise
Historically, lottery and totalisator operators in Australia were government-owned entities. Almost all states and territories (Western Australia being the exception in respect of its totalisator and lottery) have since privatised these gambling operators. Western Australia is currently progressing a potential sale of the Western Australian totalisator.
Totalisator sales and the retail (i.e., terrestrial other than on-course bookmaking) operations of the respective licence holders are conducted exclusively pursuant to a range of state and territory legislative and contractual arrangements.
The primary lottery licences on issue are largely held exclusively with exceptions in each state and territory relating to charitable lotteries and trade promotion lotteries.
Land-based casino licences are held exclusively in some states and territories with multiple licences issues in some jurisdictions (e.g., New South Wales, Queensland and the Northern Territory). The provision of online casino-type products to Australians is illegal under the Interactive Gambling Act 2001 (Cth) (IGA).
Gaming machines are operated in land-based casinos and in licensed clubs and hotels in all states and territories (other than in Western Australia where electronic gaming machines are only operated at Perth Casino).
All leading gambling businesses in Australia (many of whom are listed in Australia or overseas) conduct business under a licence granted by a state or territory government (or regulator). The principal licensed gambling operators are:
Tabcorp Holdings Limited (Tabcorp), which, since combining with Tatts Group Limited (Tatts) (see Section VIII) holds licences to conduct both lotteries and totalisators (and off-course betting) through retail outlets in Queensland, Tasmania, New South Wales, Victoria, South Australia, the Australian Capital Territory and the Northern Territory with various exclusivity arrangements in place. Tabcorp has announced a demerger of its lotteries and wagering and gaming services businesses, which is expected to occur in mid-2022;
the Star Entertainment Group Limited (The Star), which operates casinos in Sydney and Queensland;
Crown Resorts Limited (Crown Resorts), which operates casinos in Melbourne and Perth (and Sydney; however, the gaming floor at Crown Sydney remains closed as at the start of March 2022) also conducts a betting exchange and Betfair Australia (licensed in the Northern Territory);
Sportsbet Pty Limited (Sportsbet), a sports bookmaker licensed in the Northern Territory that is owned by Flutter Entertainment plc;
Entain Group Pty Ltd, trading as Ladbrokes and Neds.com.au under Northern Territory sports bookmaking licences, which is part of the global Entain plc group; and
Aristocrat Leisure Limited, Ainsworth Game Technology, Scientific Games Australia, Konami Australia, International Game Technology (IGT) and Aruze Australia (all suppliers of gaming machines).
In Western Australia, the totalisator and lottery are conducted through state-owned corporations, respectively operated by Racing and Wagering Western Australia and LotteryWest. However, the Western Australian government has recently reinitiated a market process for the potential sale of the WA TAB. Separate exclusive licences are also issued in each state and territory in respect of the conduct of keno games in land-based retail venues and, in some cases, online.
Territorial issues
As mentioned above in Section I.iii, licences to conduct gambling are issued by the relevant state or territory government (or regulator) including those listed in Section I.ii. Traditionally, gambling was conducted solely in venues but, with the introduction of new technologies, is now widely conducted online and over the telephone (other than online casino-type products, which remain illegal).
It is generally understood under principles of Australian constitutional law and expressly provided for in some state and territory legislative regimes that certain gambling services provided under a licence issued in any state or territory of Australia can be promoted and provided to residents of other Australian states and territories. This principle was confirmed by the decision of the High Court of Australia in Betfair Pty Ltd and another v. Western Australia (2008) 244 ALR 32. Each licensing jurisdiction imposes different licence conditions on its licensed operators, by reference to the relevant legislation. Most online corporate bookmakers, for example, are licensed in the Northern Territory by the Northern Territory Racing Commission (NTRC). There have recently been some moves as part of the development of the Australian Sports Wagering Scheme to evaluate the potential harmonisation of regulation in so far as it relates to sports integrity.
The principal Federal legislation governing the supply of gambling products and services is the IGA and the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth).
Offshore gambling
In 2001, the federal government enacted the IGA, which prohibits the provision of 'interactive' (or online) gambling services with an 'Australian customer link'. The IGA is enforced by the Australian Communications and Media Authority (ACMA) and the Australian Federal Police. The ACMA is active in investigating complaints for breaches of the Act and reports each quarter on its enforcement activities, including in implementing website blocking of websites found to be in breach of the IGA.
In September 2017, the IGA was amended by the Interactive Gambling Amendment Act 2017 (Cth) (the IGA Amendment Act) in response to claims that the existing legislation was ineffective as a means of deterring unlicensed offshore gambling operators from providing services to Australian residents. The amendments, among other things, increased penalties, expanded existing aiding and abetting offences, clarified the prohibition on the use of VoIP technology by licensed wagering operators to facilitate in-play betting services, banned the provision of lines of credit by wagering operators and granted the ACMA greater investigative and enforcement powers, including the power to issue formal warnings and infringement notices. Broadly speaking, the IGA prohibits the provision of 'prohibited interactive gambling services' (the Section 15 offence) and 'regulated interactive gambling services' without an Australian licence (the Section 15AA offence), to persons present in Australia (together, the Operational Prohibitions). Regulated interactive gambling services include wagering services (except for online in-play sports betting services and betting on the outcome of lotteries, which are prohibited) and lottery services (except for online instant or scratch lotteries, which are also prohibited). In addition, the IGA prohibits the advertising in Australia of 'prohibited interactive gambling services' and, unless the relevant party is licensed in Australia, 'regulated interactive gambling services'.
The IGA targets the supply of online gambling to residents of Australia by offshore operators but does not prevent Australian residents from accessing those offshore services, or the provision of services by Australian operators to customers in other countries. A defence is available for an alleged breach of the IGA where the operator did not know, or could not reasonably have known, that the service had an 'Australian customer link', that is, that any or all the customers of the service were physically present in Australia.
Legal and regulatory framework
Legislation and jurisprudence
In Australia, there is no single overarching statute regulating gambling activities, nor is there a single overarching gambling authority. Instead, gambling in Australia is regulated at state, territory, and federal levels. Each of Australia's eight mainland states and territories separately regulates gambling activities within each of their respective jurisdictions. In addition, a series of federal statutes also cover certain aspects of gambling activity throughout Australia.
The Interactive Gambling Act 2001 (Cth) for example, regulates interactive (or online) gambling services, while state and territory legislation regulates land-based and online gambling activities and sets out the regulatory frameworks for different types of gambling including casinos, sports betting, poker machines and lotteries. The Interactive Gambling Act 2001 (Cth) prevails over state and territory legislation to the extent there are inconsistencies.
Set out below is a list of the primary legislation governing gaming, betting, lotteries, and social/skill arrangements for each Australian state and territory, as well as at the federal level. For completeness, the authors note that the list of gambling-related legislation below is not an exhaustive list. There are many pieces of legislation that are incidental to gambling activity (for example, legislation setting the applicable gambling tax rates). There are also various subordinate legislative instruments, including regulations, which have not been included.
Victoria (Vic)
Casino (Management Agreement) Act 1993 (Vic);
Casino Control Act 1991 (Vic); and
Gambling Regulation Act 2003 (Vic).
New South Wales (NSW)
Betting and Racing Act 1998 (NSW);
Casino Control Act 1992 (NSW);
Community Gaming Act 2018 (NSW);
Gaming Machines Act 2001 (NSW);
Public Lotteries Act 1996 (NSW);
Unlawful Gambling Act 1998 (NSW); and
Totalizator Act 1997 (NSW).
Queensland (Qld)
Breakwater Island Casino Agreement Act 1984 (Qld);
Brisbane Casino Agreement Act 1992 (Qld);
Cairns Casino Agreement Act 1993 (Qld);
Casino Control Act 1982 (Qld);
Charitable and Non-Profit Gaming Act 1999 (Qld);
Gaming Machine Act 1991 (Qld);
Interactive Gambling (Player Protection) Act 1998 (Qld);
Jupiters Casino Agreement Act 1983 (Qld);
Keno Act 1996 (Qld);
Lotteries Act 1997 (Qld);
Queen's Wharf Brisbane Act 2016 (Qld); and
Wagering Act 1998 (Qld).
Australian Capital Territory (ACT)
Casino Control Act 2006 (ACT);
Gaming Machine Act 2004 (ACT);
Interactive Gambling Act 1998 (ACT);
Lotteries Act 1964 (ACT);
Pool Betting Act 1964 (ACT);
Race and Sports Bookmaking Act 2001 (ACT);
Racing Act 1999 (ACT);
Totalisator Act 2014 (ACT); and
Unlawful Gambling Act 2009 (ACT).
South Australia (SA)
Authorised Betting Operations Act 2000 (SA);
Gambling Administration Act 2019 (SA);
Casino Act 1997 (SA);
Gaming Machines Act 1992 (SA);
Lottery and Gaming Act 1936 (SA); and
State Lotteries Act 1966 (SA).
Tasmania (Tas)
Gaming Control Act 1993 (Tas).
Western Australia (WA)
Betting Control Act 1954 (WA);
Casino (Burswood Island) Agreement Act 1985 (WA);
Casino Control Act 1984 (WA);
Gaming and Betting (Contracts and Securities) Act 1985 (WA);
Gaming and Wagering Commission Act 1987 (WA);
Racing and Wagering Western Australia Act 2003 (WA); and
Racing Bets Levy Act 2009 (WA).
Northern Territory (NT)
Gaming Control Act 1993 (NT);
Gaming Machine Act 1995 (NT);
Racing and Betting Act 1983 (NT);
Unlawful Betting Act 1989 (NT); and
Totalisator Licensing and Regulation Act 2000 (NT).
Federal
Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth);
Financial Transaction Reports Act 1988 (Cth); and
Interactive Gambling Act 2001 (Cth).
The Regulator
The key responsibilities assigned to the state and territory gambling regulators include granting licences, monitoring compliance of gambling operators and enforcement of legislation where necessary. Set out below are the regulators responsible for regulating gambling activity in each Australian state and territory:
Victoria (Vic)
The Victorian Gambling and Casino Control Commission is Vic's independent gambling authority responsible for licensing and compliance.
The Office of Liquor, Gaming and Racing is a division within Vic's Department of Justice and Regulation responsible for policy, legislation, regulation, and major licensing.
New South Wales (NSW)
Liquor and Gaming New South Wales (L&GNSW) sits within the NSW Department of Customer Service and is responsible for policy, licensing and compliance. Separately, the Independent Liquor and Gaming Authority (ILGA) is an independent statutory decision-maker responsible for a range of casino, liquor, registered club, and gaming machine regulatory functions. A number of the ILGA's routine licensing functions are delegated to L&GNSW.
Queensland (Qld)
The Queensland Office of Liquor and Gaming Regulation (QOLGR) is responsible for licensing and compliance, and the Office of Regulatory Policy (QORP) is responsible for policy and legislative development for the regulation of liquor, gaming, and fair trading, as well as harm minimisation programmes for the liquor and gambling industries. The QOLGR and QORP sit within the state's Department of Justice and Attorney-General.
Australian Capital Territory (ACT)
The Gambling and Racing Commission sits within the portfolio of the Minister for Regulatory Services and is the ACT's independent gambling authority responsible for licensing, compliance and education.
South Australia (SA)
Consumer and Business Services sits within the Attorney-General's Department and is responsible for policy, licensing and compliance in relation to betting, casinos, gaming machines and lotteries.
The Lotteries Commission of South Australia sits within the Auditor General's Department and has the primary function of promoting and conducting lotteries in SA. It has appointed a master agent to operate the Commission's brands and products.
Tasmania (Tas)
The Tasmanian Liquor and Gaming Commission sits within the Department of Treasury and Finance and is Tas' independent gambling authority responsible for licensing and compliance.
Western Australia (WA)
The Western Australian Department of Racing, Gaming and Liquor sits within the portfolio of the Minister for Racing and Gaming and is responsible for policy, licensing, and compliance matters.
Northern Territory (NT)
The NTRC is largely responsible for compliance matters.
Licensing NT is responsible for licensing matters affecting all gambling activities in the NT.
The NTRC and Licensing NT sit within the NT Department of the Attorney-General and Justice.
For completeness, it is worth noting that, to a lesser extent, local government bodies in most states and territories also regulate gambling from a local government and town planning perspective, but typically only as it relates to gaming machines and their operation within the relevant municipal district.
Federal
The Australian Constitution provides the federal government with powers to regulate and govern, among other things, telecommunications, money and trade amongst the states and territories.
Using these powers, the federal government has enacted legislation regulating, amongst other things, interactive gambling, anti-money laundering and counter-terrorism financing (AML/CTF) and consumer and competition protections (also known as antitrust matters in some other jurisdictions).
Set out below are the relevant regulatory bodies and a brief description of how they regulate gambling.
Interactive gambling
The ACMA is the body responsible for media and communications regulation throughout Australia, including monitoring and enforcing the regulation of gambling online and over the telephone (referred to as the interactive gambling laws).
The ACMA monitors compliance with and enforces the interactive gambling laws.
Australia's federal interactive gambling laws prohibit certain activities, such as:
online casinos, slot machines and poker;
online wagering services that accept 'in-play' betting on live sports events;
online wagering services provided without a licence issued by an Australian state or territory;
online instant lotteries; and
providing or facilitating the provision of credit by certain interactive wagering service providers to their customers.
The ACMA has the power to instigate civil proceedings in Australia, notify border protection agencies of the names of directors and principals of offending illegal offshore operators (who may then be placed on a 'movement alert list', thereby disrupting any travel to Australia) and liaise with foreign regulators to stop alleged offenders.
AML/CTF regulation
The Australian Transaction Reports and Analysis Centre (AUSTRAC) is the regulator responsible for detecting, deterring, and disrupting criminal abuse of the financial system, including money laundering and terrorism financing.
Under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (the AML/CTF Act), certain gambling activities are classified as 'designated services' with providers of these services being 'reporting entities' required to, amongst other things, register with AUSTRAC, develop, and maintain a compliant AML/CTF programme and to report certain transactions to AUSTRAC, including by way of threshold transaction reports (TTRs) and suspicious matter reports (SMRs).
Failure to comply with the AML/CTF Act, including not maintaining a compliant AML/CTF programme and not filing TTRs or SMRs (or filing them late), can result in large civil penalties and possible criminal exposure. For example, in 2017 a large Australian gambling company paid an A$45 million civil penalty to AUSTRAC for failing to comply with certain requirements under the AML/CTF Act.
Competition
The Australian Consumer and Competition Commission (ACCC) is responsible, under the Competition and Consumer Act 2010 (Cth) (CCA), for, amongst other things, enforcing Australian consumer protection laws. From a gambling perspective, the ACCC monitors compliance by gambling service providers of their obligations under the CCA, including gambling advertising (to ensure the consumer is not being treated unconscionably or unfairly, in breach of the CCA). It also takes appropriate enforcement action where it deems necessary.
Remote and land-based gambling
There is no single overarching statute regulating gambling activities in Australia, nor is there one overarching regulator. Instead, gambling in Australia is regulated at the state, territory and federal levels. Each of Australia's eight states and territories separately regulates both brick-and-mortar (land-based) and remote (online) gambling activities. For instance, each state and territory has a relevant Casino Control Act (or similar legislation) under which land-based casino licences have been issued. Separately, state and territory legislation generally allows those entities that hold a licence to operate online.
In addition, at the federal level, there are statutes that cover certain aspects of some gambling activities, such as the protection of personal information and obligations surrounding anti-money laundering and counter-terrorism financing.
In relation to online gambling, the federal government has enacted the IGA. The IGA prohibits overseas-based operators, who do not hold a relevant state or territory licence, to provide online gambling to Australian residents. The IGA also prohibits certain forms of online gambling such as casinos, poker and bingo.
Land-based gambling
Land-based gambling is regulated predominately through state and territory legislation. Although there are some exceptions, such as the Anti-Money Laundering and Counter Terrorism Financing Act 2001 (Cth) (AML/CTF Act), which is a federal piece of legislation that also applies to land-based gambling operators. Land-based gambling can be understood through the various licences generally available under state and territory legislation.
Off-course betting in retail venues (retail wagering)
Retail wagering includes offering pari-mutuel (totalisator) bets on racing (thoroughbred, greyhound, and harness) and some sports as well as fixed-odds betting on racing, virtual/simulated racing, sports and other approved events. Generally, retail wagering is offered by the state and territory totalisator agency boards (TABs) pursuant to a sole licence, thereby providing the TABs with a form of retail exclusivity. The TABs offer their land-based retail wagering in dedicated retail venues, racecourses, or terminals in hotels and clubs.
Lottery products
Like retail wagering, an exclusive licence has been granted to provide land-based lottery products in each state or territory. These products are generally available for purchase by consumers from retailers, with the most prevalent location being newsagents.
Licensed gaming machine operators (i.e., slot or poker machines)
Generally, gaming machines such as slot or poker machines (colloquially referred to as 'pokie' machines) are permitted under the various state and territory licensing regimes in casinos, hotels, and clubs (except for Western Australia where gaming machines are only permitted in casinos). The regulation (including the total number of gaming machines available) differs in each state and territory. For example, in New South Wales, the socioeconomic impact on the venue/area is considered during any application to raise the number of gaming machines.2 Additionally in Victoria, couples a venue, area, and jurisdiction cap on the number of gaming machines with a mandatory pre-commitment system (which players can opt-out of).
Land-based casinos
The number of casino licences available is limited. Typically, there is only one per state and territory, except in the case of current casino licences held in Queensland and Northern Territory. In NSW, there is one casino licence issued to The Star. Recent legislative changes relaxed the limit, and Crown Resorts gained a restricted gaming licence for its development in Barangaroo.
This licence was subject to an inquiry (known locally as The Bergin Inquiry) under Section 143 of the Casino Control Act 1992 (NSW), and it was found not be a suitable person to hold such a licence. Crown Resorts is currently consulting with the Independent Liquor and Gaming Authority to seek to address these issues.
Remote gambling
As stated previously, online gambling is regulated at a state, territory, and federal level. To offer remote (online) gambling services to Australians is a two-step process. First, the type of online gambling must not be prohibited under the IGA. As stated previously, some of the unlawful kinds of online gambling include online casinos, bingo, and poker. Second, to offer lawful types of online gambling, there is a requirement to hold a state or territory-issued licence that enables online gambling.
The federal regulator, the ACMA, administers the IGA. Recently the ACMA has become more proactive in its enforcement of the IGA and regularly requests internet service providers block websites that breach the IGA or are for unlicensed operators operating in or offering services into Australia. A key focus of the ACMA has been combating illegal online casinos from being offered into Australia. More recently, the focus has expanded to target affiliate advertising websites that drive traffic towards illegal gambling websites.
Ancillary matters
Depending on the gambling service, ancillary licences may be required in addition to the principal licence granted to the operator to conduct the gambling business. For example, in addition to licences granted to operators that conduct gambling activities in a casino or other land-based venue, separate licences are required to be held by manufacturers and suppliers of poker machines, as well as testing agents. In most cases, key employees or close associates of licensed operators are required to hold a separate licence, or at least be approved by the regulator prior to commencing their role.
Financial payment mechanisms
Currently, Australians cannot use credit cards when gambling in land-based licensed venues, casinos, and TAB retail wagering outlets. However, the same cannot be said for online gambling. Credit card use is currently permitted for online gambling because the IGA contains an independently issued credit card exception in the general prohibition on licensed operators from providing credit (or otherwise facilitating it through third parties). Over recent years, the use of credit cards in online gambling and this exception in the IGA has been debated. Most recently, the Parliamentary Joint Committee on Corporations and Financial Services (Committee) recommended that the federal government should develop and implement legislation to ban online gambling service providers of wagering, gaming and other gambling services (but not lotteries) from accepting payment by credit cards (including via digital wallets). The Committee also recommended that when implementing this ban, the federal government should ensure that it does not have any adverse consequences for lotteries, including the activities of not-for-profits, charities and newsagents. It is unclear if the federal government will adopt these recommendations.
In addition, virtual currencies (i.e., cryptocurrencies) are not currently used as a real-money alternative for gambling in Australia by any of the major licence holders. The use of virtual currencies is the subject of consideration by the various state and territory gambling regulators. In 2018 a bookmaker, proposing to be Australia's first bookmaker to accept cryptocurrencies, was prevented from doing so by the Northern Territory regulator, the NTRC. The NTRC issued a declaration prohibiting the acceptance cryptocurrencies as a payment method by those entities it licensed. Notwithstanding this ongoing consideration by gambling regulators, Australia's financial regulator the AUSTRAC regulates virtual currencies.
