ACMA facing second review, as govt ponders online gambling

By David Donaldson

Wednesday September 2, 2015

The federal government will move to tighten rules against foreign online betting companies, it was reported on Wednesday, as its review into the functions of the Australian Communications and Media Authority gets going. Submissions to the ACMA review show Australian gambling companies Tabcorp and Sportsbet are pushing for updated legislation and better enforcement against overseas competitors.

The government is expected to act before Christmas to change the existing regime following a review to be conducted by Social Services Minister Scott Morrison into the Interactive Gambling Act 2001, said The Australian on Wednesday. The review will examine the economic impacts of illegal foreign gambling websites, international regulatory regimes and technological and administrative options for better regulation of the sector.

The Interactive Gambling Act has been criticised recently by Australian-based companies in their submissions to the government’s review of the Australian Communications and Media Authority, which administers the law. According to Tabcorp:

“Legislation administered by the ACMA which regulates the online gambling entertainment industry has not kept pace with industry changes … The IGA should be modernised and the agency responsible for its administration requires stronger powers to prosecute offenders and impose penalties.”

Under the current model, Commonwealth government gambling regulatory functions “are spread across multiple agencies which limits effectiveness and wastes resources”, argues the betting company. Consolidating functions in fewer agencies would realise savings, deliver better services and give greater certainty to consumers, argued TABCORP.

The world of online gambling has changed markedly since the Act was passed in 2001. Australians are now able to easily access gambling services from unregulated foreign companies, whether on a PC or smartphone, hugely enabling potentially harmful behaviours outside the reach of Australian regulators.

Tabcorp argues that ACMA, or its successor as regulator, should be given stronger enforcement powers:

” … the IGA also does not give the ACMA adequate enforcement power to impose penalties for breaches. In line with changing industry and the growth of globalisation, the body tasked with enforcing the IGA may also need new powers to monitor, regulate and possibly restrict gambling providers domiciled outside of Australia from operating in Australia.

“A legislative framework that has not kept pace with industry changes, accompanied by a less than optimal enforcement regime, has resulted in new market entrants over-stepping legislative boundaries, particularly with new technologies, with seemingly no action being taken by the Australian Federal Police and consequently no penalties being imposed. Organisations are able to take advantage of slow bureaucratic processes which enable illegal activities to continue without sanctions.”

Introducing a civil penalty regime “would promote a greater level of effective regulation through more easily enforceable sanctions” argued Sportsbet’s submission to the ACMA review. As civil penalties require a lower standard of proof than criminal offences, and would not involve the AFP — who may place a lower priority on such issues — this approach could lead to more effective enforcement.

As part of this, ACMA should be given the power to issue and act upon take-down notices to remove prohibited content of gambling service providers hosted in Australia in a timely manner, Sportsbet said.

In addition, to increase the deterrent effect of ACMA’s regulatory approach, there should be greater provision for ensuring the operators of prohibited services are aware of Australia’s laws and the penalties involved, including by regularly publishing on the ACMA website a list of known prohibited gambling operators.

Sportsbet is also, more controversially, pushing for what it calls “a platform-neutral approach to in-play betting”. Currently, in-play betting — where bets can be placed after an event has commenced — is banned online, but permitted over the phone and in person at retail TAB venues.

A “platform-neutral” approach would, in effect, loosen regulations on this practice, something Sportsbet argues would allow Australians to bet with Australian companies — rather than unregulated foreign services — and bring punters into contact with the sorts of harm minimisation measures required under Australian law.

In 2013, ACMA banned the promotion of live odds during broadcasts with new codes of conduct, putting an end to the live TV career of Tom Waterhouse or anyone who wanted to emulate the practice.

Independent South Australian Senator Nick Xenophon is drafting legislative amendments, however, that would ban all in-play betting.

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