Some questions and answers on regulation for online gambling

Is my gambling service or gambling product prohibited by the Interactive Gambling Act 2001?

Ask for independent legal advice if you have any doubt at all about how the Interactive Gambling Act 2001 applies to you or your organisation. We can only explain the policy intent of the Act. We can’t give you legal advice.

How is online gambling regulated?

The main offence provision of the Interactive Gambling Act 2001 is clause 15: the offence of 'providing an interactive gambling service to customers in Australia'.

This provision applies to the providers of interactive gambling, rather than users. It’s not an offence for someone to gamble online. Also, the Act does not override the laws of other jurisdictions, such as Australian states and territories and other countries. If you gamble using illegal services and the provider refuses to pay your winnings or return your deposit, there is little you can do

How are lotteries regulated?

Most lotteries are not prohibited, even if they’re offered over the internet. Traditional lotteries like jackpot lotteries and weekly Lotto draws are not likely to be a risk to problem gamblers.

Only rapid or player initiated online lotteries such as online scratchies are banned under section 8D of the Interactive Gambling Act 2001. They’re virtually indistinguishable from other online, player-initiated games that are a greater risk to problem gamblers.

The Act also lets the Minister ban 'highly repetitive or frequently drawn forms of keno-type lotteries or similar lotteries’ if they become a problem.

How is wagering regulated?

Online wagering is gambling on sports matches and horse races. It’s generally allowed, other than:

  • 'Ball by ball' wagering— on any aspect of a sporting event after it has started
  • 'Betting on the run' — because it involves betting on a sporting event after it has started

These two types of online gambling are prohibited because they are especially harmful.

For example, an online gambling operator:

  • can take bets during a tennis tournament
  • can’t take bets during any single match, for example a bet on whether the next serve will be an ace.

The aim of this prohibition in the Interactive Gambling Act 2001 is to balance the impact of online gambling against the impact of a ban on long established industries in Australia, such as the thoroughbred racing industry.

Other forms of online gambling are not prohibited by the Act, such as online betting on non-sporting events. Find out more: Explanatory memorandum (PDF, 205.5 KB) (DOCX, 123.2 KB).

How do you define a 'sporting event'?

A 'sporting event' is not defined in the Interactive Gambling Act 2001, so it has its ordinary, dictionary meaning. The explanatory memorandum (PDF, 205.5 KB) (DOCX, 123.2 KB) provides guidance and examples (see discussion of section 8A(2)).

For example, a tennis match is a sporting event. An individual point, game or set in a tennis match is not a sporting event, but it is a part or an aspect of a sporting event. A tennis tournament is also not a sporting event, but rather a series of sporting events.

In other words:

  • You can gamble on the tournament before it’s started and while it’s going.
  • You can gamble on a match before it has started.
  • You can’t gamble (online) on any aspect of a tennis match after the match has started.

Online wagering on a non-sporting event is permitted at any time (before and after the event has started).

Is footy tipping affected?

In general, no. Office or private tipping competitions run by email or over the internet on a non-commercial basis (and similar activities) are not intended to be prohibited by the Interactive Gambling Act 2001.

These competitions are generally not provided in the course of 'carrying on a business in Australia', which is an element of the offence of providing online interactive gambling to customers in Australia (clause 15). Even if they are provided on a commercial basis, these types of gambling generally do not allow betting on a sporting event after it has started, and so they would qualify for the wagering exemption (section 8A).

Is telephone betting affected?

Telephone betting services are allowed. A 'telephone betting service' is defined in clause 4 as 'a gambling service provided on the basis that dealings with customers are wholly by way of voice calls made using a standard telephone service’. Telephone betting has long standing in the Australian community. There are no plans to ban it.

Is charity-operated gambling affected?

No. Because of their not-for-profit status, charitable gambling activities such as art unions and raffles are generally regarded as not being provided 'in the course of carrying on a business in Australia’—this is an element of the offence of providing an interactive gambling service to customers in Australia (clause 15).

Online gambling activities provided by registered charities are not intended to be prohibited by the Interactive Gambling Act 2001, but state and territory regulations still apply.

What if gambling operators abuse the exemptions?

The Interactive Gambling Act 2001 lets the Minister make regulations to place conditions on certain exemptions to prevent abuse and circumvention of the intent of the Interactive Gambling Act 2001. The Minister can place conditions on the following exemptions:

  • the lotteries exemption (section 8D(1A))    
  • the wagering exemption (section 8A(1A))   
  • the excluded gaming service exemption (section 8B(1A)), and
  • the television games exemption (section 8C(1B)).

So far, no such regulation exists.

Isn't gambling a state and territory responsibility?

The Commonwealth has the power to regulate interactive gambling because it uses communications services.

Section 51(v) of the Australian Constitution gives the Commonwealth responsibility for 'postal, telegraphic, telephonic, and other like services.' This head of power is the basis for Commonwealth regulation of communications services, including broadcasting, telecommunications and the internet.

The Constitution doesn’t give the Commonwealth specific powers over offline gambling. The regulation of offline gambling therefore remains primarily a state and territory responsibility.

Are networked computer games banned when they are played for money or prizes?

No. Computer games are regarded as games of skill more than games of chance (or luck). They’re not regarded as gambling.

Gambling is defined as 'a game of chance or of mixed chance and skill’ (clause 4 of the Interactive Gambling Act 2001). This definition is derived from state and territory legislation and is well established in law.

Computer games do not fall within the definition of 'gambling’ in the Interactive Gambling Act 2001, even where there is consideration to play and prizes. The explanatory memorandum (PDF, 205.5 KB) (DOCX, 123.2 KB) provides guidance and examples on this matter (see discussion of clause 4 and section 8C).

Are television games and promotions like the internet voting on 'Australian Idol' or registering to be a contestant banned?

No. Under section 8C of the Interactive Gambling Act 2001, gambling with a designated broadcasting or datacasting link is not prohibited. This means that promotions run in close association with television programs are also not prohibited. The explanatory memorandum (PDF, 205.5 KB) (DOCX, 123.2 KB) provides guidance and examples on this matter (see discussion of section 8C).

Does the Act cancel out state and territory legislation?

Gambling that is exempt under the Commonwealth Interactive Gambling Act 2001 is not necessarily exempt from state or territory law. Conversely, a service can be prohibited under the Commonwealth Act, even if it is licensed or authorised under state or territory law.

This is in section 69 of the Interactive Gambling Act 2001, which provides that the Act is 'not intended to exclude or limit the operation of a law of a state or territory to the extent that that law is capable of operating concurrently'.

Does the exemption for online lotteries affect small business?

Most online lotteries are exempt from the Interactive Gambling Act 2001. Even if they’re offered on the internet, traditional lotteries such as jackpot lotteries and weekly Lotto draws are not likely to be a risk for problem gamblers. Only rapid or player-initiated online lotteries like online scratch tickets are prohibited. Like casino gaming, these products are a greater risk for problem gamblers.

What about public places? Have poker machine jackpots and Club Keno been banned?

Gambling in a public place, such as a licensed pub, club or casino, is not prohibited by the Interactive Gambling Act 2001. It means that linked jackpot poker machines in clubs are still permitted.

The reason for allowing gambling in these public places was so traditional forms of gambling could continue, even if they use communications services, such as linked jackpot poker machines and Club Keno games. The states and territories regulate these types of gambling.

Can I gamble in an internet cafe?

Online gambling in an internet cafe would potentially qualify for the 'excluded gaming service' exemption, which exempts interactive gambling services in a public place (section 8B).

All states and territories have strict laws about places in which gambling can be provided. An exemption from the Commonwealth Interactive Gambling Act 2001 does not prevent the operation of state and territory regulation. The explanatory memorandum (PDF, 205.5 KB) (DOCX, 123.2 KB) provides guidance and examples on this matter (see discussion of section 8B).

How can an interactive gambling operator reasonably be expected to differentiate customers in Australia from customers who are outside Australia?

Various technologies and methods exist for ascertaining the physical location of a customer of a service on the internet. These range from advanced geographical location software to a requirement that customers prove their identity and location offline before the service is provided.

An interactive gambling operator facing a charge under the main offence provision of the Interactive Gambling Act 2001 would have to demonstrate that it put in place reasonable measures to prevent Australian customers from accessing its services. This is set out in clause 15 of the Interactive Gambling Act 2001, which provides for a defence of 'reasonable diligence' to the offence of providing interactive gambling to customers in Australia.

None of these methods is failsafe. The Interactive Gambling Act 2001 does not mandate any particular technology or method for interactive gambling operators to use. Instead, it describes various elements that a court could take into account in assessing a defence of reasonable diligence.

These include:

  • whether the operator told prospective customers that Australian law prohibits the provision of the service to people in Australia
  • whether customers had to enter into contracts that were subject to an express condition that they couldn’t use the service if they were in Australia at the time
  • whether customers had to provide personal details that showed they weren’t in Australia  
  • whether network data shows their customers were outside Australia when the account was opened and while the customer was gambling online  with them
  • anything else that’s relevant.

The explanatory memorandum (PDF, 205.5 KB) (DOCX, 123.2 KB) provides guidance and examples on this matter (see discussion of 15(4)).

Can I put a link on my personal website to an interactive gambling site?

Yes, but only if:

  • you aren’t providing interactive gambling services yourself
  • you aren’t doing it on your own initiative
  • you aren’t receiving any direct or indirect benefit, whether financial or otherwise, for the publishing the link.

This is covered in clause 61EE of the Interactive Gambling Act 2001.

Do internet service providers have to block offshore sites?

Internet service providers (ISPs) don’t have to block prohibited online gambling sites.

If there’s a complaint, the Australian Communications and Media Authority (ACMA) can direct an ISP to give their customers one of the approved filters listed in Schedule 1 of the Interactive Gambling Industry Code. The Interactive Gambling Act 2001 doesn’t tell ISPs how to do it or what technology they should use.

What is the Government doing about problem gambling?

Problem gamblers can access counselling and assessment referrals. These include:

  • a single national website, www.gamblinghelponline.org.au, with online counselling for problem gamblers; and
  • a single national toll-free number, 1800 858 858, for telephone counselling.

Problem gambling is an issue the Australian Government takes seriously. We will continue to monitor the effectiveness of the Interactive Gambling Act 2001.