The Future of Online Gambling in New Zealand: Regulatory Changes Ahead

New Zealand’s gambling industry stands at a crossroads as the government prepares to delve into the world of online gambling regulation. With its planned regulatory regime set to launch by 2026, there is an air of concern within the local industry. The primary issue at hand is the fear that deep-pocketed overseas operators, unencumbered by local accountability, may outbid domestic companies for online casino licenses in a forthcoming auction. This article will explore the implications of these changes and the varying viewpoints within the industry.

Current Regulatory Landscape

Presently, online gambling operates in a regulatory grey area in New Zealand. Although the government has recognized the need for a structured approach, many questions remain about how to effectively regulate this burgeoning market. As the Department of Internal Affairs (DIA) moves forward with its initiative, it has outlined plans for legalizing and regulating online gambling—an effort that also serves a dual purpose: to address the regulatory gap and to create a new venue for tax revenue generation.

A “high-level” approach was developed to auction off 15 licenses to operators that meet specific integrity and harm minimization criteria. Additionally, regulations to permit online gambling advertisements with strict limits were proposed. Notably, the new licensing framework aims to replace the existing unregulated landscape, which has allowed many offshore operators to flourish, often at the expense of local entities.

Competition for Licenses

The competition for the newly issued licenses is expected to be fierce. According to reports from the DIA, offshore operators currently dominate the market, with the top 15 of them accounting for over 90% of the Goods and Services Tax (GST) revenue collected in the last three years. As the industry shifts towards regulation, the auction process is projected to generate around $44 million over a decade, a figure that is, however, significantly lower than previous government forecasts of $179 million annually.

Upscale local institutions, like Christchurch Casino and SkyCity, which already operate online casinos from overseas bases, acknowledge the imminent challenges posed by well-funded offshore competitors. "No, not at all," said Brett Anderson, CEO of Christchurch Casino, when asked if securing a license was a certainty. He emphasized the need for the regulatory framework to protect local entities from being sidelined by larger, faceless providers.

Uneven Playing Field

The issue of fairness in the gambling landscape has been a contentious topic. SkyCity has voiced concerns about an unequal competitive environment that allows offshore operators to bypass local laws while legitimizing their business operations in New Zealand. Jason Walbridge, SkyCity’s CEO, has been vocal about wanting to ensure that companies complying with local laws are rewarded, stating that prospective licensees with a history of breaking these laws should be held accountable before being considered for licensing.

Both local casinos argue for a limited number of licenses to prevent market fragmentation, suggesting that too many operators could lead to chaos. "We want to see a limited number of operators to ensure things don’t get out of control," Walbridge insisted.

The Community Connection

One of the primary distinctions that Christchurch Casino and SkyCity wish to make clear is their commitment to the New Zealand community. Both operators are keen to emphasize their established presence and involvement in harm minimization efforts, arguing that they are more accountable compared to anonymous offshore operators. Anderson highlights the importance of local engagement by indicating that “we’re in the community with a greater concern for what happens within the community.”

The sentiment resonates through their lobbying efforts, as local operators are advocating for their interests while expressing the need for accountability from all license holders—local and offshore alike.

Looking Ahead

As New Zealand’s government continues to outline the parameters of its regulatory framework, the potential tension between local operators and offshore entrants presents an intricate challenge. The urgency to ensure that local businesses have a fair chance in a newly regulated market cannot be understated.

With regulatory measures expected to reshape the online gambling landscape, particularly with the auction of licenses, industry stakeholders are keenly watching how the government will address concerns about market integrity, responsible gambling, and tax compliance.

The government’s approach in navigating these waters will ultimately set the tone for a balanced and fair online gambling ecosystem in New Zealand, one that satisfies the interests of both local operators and consumers while curbing the influence of unregulated offshore entities. As 2026 approaches, the spotlight will definitely remain on the unfolding dynamics within this space.