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Lottoland Under Investigation: What the Government’s New Gambling Laws Mean For You

Lottoland Under Investigation: What the Government’s New Gambling Laws Mean For You

The Government is cracking down on synthetic lotteries. Find out what this means for you here.

16th January 2019

International betting magnate Lottoland have recently attracted the attention of some of Australia’s biggest regulators. The concerns relate to Lottoland’s most recent product offering and whether they are operating in breach of current gambling laws. The Australian Securities and Investments Commission (ASIC) is currently responding to a complaint made against the company regarding their new “jackpot betting” offering. Lottoland released the product only days after the government’s new gambling laws came into effect.

What Are The New Laws?

In June of 2018, the Federal Government approved legislation that will impose a nationwide ban on lottery betting websites. The Interactive Gambling Amendment (Lottery Betting) Act 2018  officially came into effect on the 9th of January, following the 6 month transition period. The intention of this amendment was to respond to societal concerns regarding the negative impact secondary lottery products have on small business and government tax revenue.

Synthetic or secondary lotteries essentially exploit official draws by allowing consumers to bet on the outcome without a ticket. For example, companies such as Lottoland let you pick numbers drawn in externally run lotteries. If those numbers match what is drawn in the official lottery, the company will pay the same jackpot amount. The amendment effectively prohibits this practice by banning betting services on the outcome of international and Australian lotteries.

Impact Of These Laws

In response to the new legislation, Lottoland have launched a new product that aims to circumvent the restrictions. Lottoland’s “jackpot betting” operates by taking numbers from financial markets at various points in the day. They then use computer software to convert them into winning numbers for the lottery draw. As a result of the legislation, Lottoland ceased accepting bets on Australian lotteries late last year. Although despite the latest laws coming into effect, they still appear to be marketing American based lotteries. However these do seem to fall under their new jackpot betting product and therefore there is an element of uncertainty surrounding this.

Regulatory Response

In addition to ASIC, the Australian Communications and Media Authority (ACMA) are analysing the jackpot product to see it breaches gambling laws. ACMA are the leading government authority responsible for regulating online betting. They provide a definitive list of wagering service providers who hold a license to operate in Australia, for consumer reference. The communications minister, Mitch Fifield, requested this action from the ACMA to ensure there are no activities operating contrary to the law. Licensing Northern Territory are another regulator investigating the Lottoland situation. However, they are focussing their attention on the potentially misleading nature of Lottoland’s promotions.

All of these investigations are ongoing, with the results still yet to be determined. At this stage, the key takeaway for punters is that they will no longer be able to place bets on international lotteries via these secondary websites.

Need more information? Contact a LawPath consultant on 1800 529 728 to learn more about customising legal documents and obtaining a fixed-fee quote from Australia’s largest legal marketplace.

Author
Christopher Tsiknas

Chris is a member of the content team at Lawpath. He is currently studying a Bachelor of Business and Bachelor of Laws at UTS. He is interested in how marketing communication strategies can influence the future of legal technology.