The Select Committee has reported back to Parliament following its consideration of the Online Casino Gambling Bill (Bill). The Bill will establish a licensing regime so that only operators (whether from New Zealand or offshore) holding a licence can conduct or advertise online casino gambling to New Zealanders. Currently online casino gambling operated by offshore operators is unregulated in New Zealand (other than offshore gambling duty). By all accounts online gambling is trending upwards and the Bill includes, as its purposes, consumer protection and harm minimisation, which can only be a good thing for New Zealanders.
The Bill will commence on 1 May 2026, but the prohibition on providers offering online gambling will not take effect until 1 December 2026 (for operators who have not applied for a licence) and at the latest, 1 June 2027 (for operators who have applied for a licence).
Much of the operational detail of the regime, including measures relating to harm minimisation, consumer protection, and advertising, will be set out in regulations. The delayed start to the prohibition is, in part, because those regulations are not intended to be made until mid-2026. The Department of Internal Affairs has advised that it intends to give the sector time with the finalised regulations before running the licensing process.
What is online casino gambling?
Online casino gambling is gambling at a distance by interaction through a communication device (eg a mobile phone). It includes gambling based on any random number generator, chance-based outcome generation (eg poker machines), casino table gambling (eg blackjack or poker) or betting on the outcome of a computer-simulated sporting event (not including humans or animals). Excluded are protected lotteries run by the NZ Lottery Commission (eg Lotto, Powerball, Lotto Strike), betting on the outcome of a lottery draw with a third party (this is a new addition - known as synthetic lotteries) and betting on any physical sports events held in or outside New Zealand (eg horse racing and other sports events run by the TAB).
Financial returns to the community
Following strong pressure from sports clubs and community organisations (3966 of the 4837 submissions), the Bill has been amended to include as an additional purpose 'ensuring that money from gambling profit benefits the community'. The Bill increases the offshore gambling duty imposed on offshore gambling profits under the Gaming Duties Act 1971 from 12% to 16% – with 4% being 'ring-fenced' for financial returns to the community. The gambling duty provisions will come into force on 1 January 2027, and Cabinet has agreed to a review of the community returns policy two years after the Bill comes into force.
How do you apply for a licence?
The Secretary for Internal Affairs can issue up to 15 licences – each licence can be for up to three years with one right of renewal for up to five years.
There are requirements on who can be a licence holder: an applicant cannot have 'significant influence' (ie own or control 20% or more securities or voting power in a licence holder) over more than three licences at any time nor be a person the Secretary considers is likely to prejudice New Zealand's international reputation with regards to trade or the maintenance of the law.
The licensing process will be undertaken in three stages:
- The Secretary will call for expressions of interest to be provided within 20 working days of giving public notice. An applicant will need to provide prescribed information relating to its contact details, key officers, ownership structure, any 'significant influence' it has over other licences, branding, gambling platform and if the applicant or its key officers have been convicted of any 'relevant offence'. The Bill also requires details as to any contribution the person intends to make for community purposes in New Zealand and disclosure about the jurisdictions in which each person part of the ownership structure is resident, incorporated or is treated as having a presence.
- Successful applicants will be invited to participate in a competitive process, for example, an auction or tender, to determine who may apply for a licence and the amount payable for a licence.
- Successful participants under the competitive process can then apply for a licence within 20 working days of being given notice (or such longer period as the Secretary may allow). The application must contain details as to the applicant's strategies relating to advertising and marketing, consumer protection, harm prevention and minimisation, compliance, its business plans and the proposed online casino gambling platform.
Once a licence is issued, the operator must display a registration icon and play a registration audio mark on its gambling platform and on any visual or audio advertisement.
Consumer protection and compliance
The Bill requires operators to comply with a number of consumer protection provisions: no credit can be provided for gambling, players must be at least 18 years old (interestingly, the minimum age to enter a 'brick and mortar' casino in New Zealand is 20 years old); and any persons who have self-identified as a 'problem gambler' to the operator or recorded themselves on a 'register of excluded players' are to be excluded. The operator must set up a 'complaints register' and information relating to complaints is to be provided quarterly to the Secretary.
The Bill treats certain breaches as civil liability acts enforceable by pecuniary penalties ordered by the High Court. The maximum amount of a pecuniary penalty is $300,000 for an individual and $5m for other entities.
Please contact us for any further information relating to the Bill.
Kelly Williams is on the board of trustees of Sport Auckland (in addition to her role at Buddle Findlay).
