Inside Australia’s reforms: Everything you need to know about the new restrictions

Australia’s proposed gambling reforms represent the most significant changes to the country’s online gambling framework in years. Global Gaming Insider caught up with Jamie Nettleton, Gaming and Gambling Partner at Australian law firm Addisons, for an in-depth overview of the proposed adaptations.

The path to Australia’s gambling reforms

In an earlier conversation published in our weekly GGI Friday newsletter, Nettleton outlined the background to the reforms, noting that Australia has regulated online gambling for 25 years and that the current changes mark only the second major overhaul of the framework. The reforms are the Australian Government’s response to the Murphy Report that followed a parliamentary inquiry, which found that online betting had become too widespread, with concerns over advertising levels and promotional inducements.

While the Government adopted several of the inquiry’s recommendations, it stopped short of introducing a complete ban on online gambling advertising. Although the reform is somewhat broader in scope, the below questions focus on why the Government took that approach, the practical challenges operators face in complying with the new restrictions and whether measures targeting illegal offshore operators will be effective.

Why do you think the Government stopped short of completely banning online advertising, as advised in the Murphy report, and what legal policy considerations may have influenced that decision?

Many stakeholders rely on having a viable regulated online betting industry. This includes sports organisations, which receive significant product fees and benefit from integrity information provided by licensed operators, as well as governments, which receive considerable tax revenue from the sector. There were a number of discussions taking place behind the scenes, but I think the main voices involved were the racing and sporting sectors, and licensed online gambling operators.

How challenging will it be for operators to comply with the new advertising restrictions in practice?

I think there will be a lot of uncertainty around what some of these restrictions actually mean. They are extremely complicated for onshore operators. They’ve clearly been given a great deal of thought, but we’re spending a lot of time, frankly, just trying to understand them. It is really challenging – even for us. We’re meant to be at the forefront of the legal understanding of this law – and it’s hard.

What that really means is there will be uncertainty about how these measures operate in practice. There are going to be doubts about what some of the provisions actually mean. I think the Government recognises this because there are numerous references to guidance being issued.

The practical implementation of this law is extensive. It’s coming into force within a few months. Social media platforms will need to introduce functionality requiring anyone who accesses online gambling content to go through a triple-lock process. That is going to be very, very challenging to implement from a technical perspective.

The bill strengthens regulator powers and enables banks and payment providers to block transactions to illegal offshore operators. How legally and practically effective do you expect these measures to be?

I think the Government had to do something because it recognised there was a practical loophole that allowed Australians to fund offshore gambling transactions, with only limited action being taken against the financial institutions facilitating those payments. The Government has introduced restrictions and they are, again, quite extensive.

However, financial institutions have a defence. If they put measures in place to prevent those transactions and get it wrong, they still have leeway. That suggests to me that, given the practical difficulties they will face, financial institutions are only required to take steps that are reasonably practical.

How do you think financial institutions will respond?

I think they will introduce measures that go much further than many people anticipate. But I also don’t think they’re going to be fully effective. Even if you can identify a URL associated with an offshore gambling operator, there are plenty of other ways and channels through which funds can be transferred from someone in Australia to an offshore gambling operator. We won’t know how effective these measures are until the law comes into force and we see how they operate in practice.