The government of New Zealand is fulfilling its promise of forcing international online gambling brands to pay betting information fees and point of consumption taxes on wagers taken from residents. David Bennet, the newly appointed Racing Minister, introduced the Racing Amendment Bill into Parliament. The bill would amend the 2003 Racing Act in hopes of increasing profits for the domestic racing and sports betting markets amidst fierce competition from internationally licensed brands. It is a possibility that this move will drive the legal New Zealand online sportsbooks operating offshore out of the NZ gambling market.
The New Zealand Racing Board is the direct beneficiary of this amendment, should it pass. The Offshore Betting Working Group originally submitted the proposed changes back in 2015 to try and help the NZRB compete with international online gambling sites that accept New Zealand residents. The NZRB’s TAB betting service is a bit outdated and their online technology simply could not keep up with the streamlined platforms of international competitors. The TAB platform even suffered an embarrassing crash in fall of last year, highlighting their technical flaws.
One of the biggest points with this amendment is that international operators must pay a consumption charge on winnings from Kiwi punters. The Working Group suggested implementing a 2% rate, but nothing has been made official yet. In addition, international operators must turn over data regarding Kiwi punters to determine the specific amount owed. As a matter of fair treatment, operators may not be charged more than what the NZRB charges local racing and sports betting outfits.
International operators must also pay fees to use information on New Zealand racing and sporting events. Those who pull in less than $60k from Kiwi bettors are exempt from any additional charges regarding consumption and information usage. Any brand in violation of the bill’s procedures faces a $50k fine; $20k for individuals at fault. However, New Zealand’s government may not possess the clout necessary to impose such enforcement. One thing that could aid New Zealand with their enforcement is their association with the Asian Racing Federation, which recently assembled an Anti-Illegal Betting Task Force aimed at internationally licensed online gambling platforms. Despite various enforcement strategies, it will be difficult to force international brands to comply with the gambling laws in New Zealand.
In-race betting will now be available via the Racing Amendment Bill, but only bets on the final race outcome, not on race events in real time. The same policy applies to in-game sports wagering, which the local TAB betting service offers Kiwi punters. The NZRB will also have the freedom to offer betting lines on domestic and international sports that it does not have agreements with. Normally, the NZRB would have to work out a deal to determine the distribution levels of betting income, but with this bill the NZRB can offer betting lines without any prior agreements. This is arguably the best point of the amendment, because now the NZRB can offer wagering on America’s National Football League, for example, one of the biggest leagues in international sports.
New Zealand’s mission is not to encourage more gambling, but rather to increase the value of local sporting and racing events to offshore operators. They also want to reel in money currently being gambled overseas back into the local regulatory framework. If the Racing Amendment Bill passes, New Zealand will be better able to hold international operators accountable for offering Kiwi sporting events.