New Zealand is gearing up to regulate its online casino market by 2026, with the government planning to issue a limited number of licenses through an auction process. This move is expected to generate significant revenue, although estimates vary on the exact figures.

Government Revenue Projections

According to Jarrod True, a prominent gambling lawyer from True Legal, the New Zealand government has budgeted for a taxable annual revenue of NZ$500 million (approximately US$300.8 million) from the regulated online gambling market. However, this figure is notably lower than industry estimates. Existing monopolies in New Zealand, such as Tab NZ and Lotto NZ, suggest that the current grey market spending is closer to NZ$900 million.

The popularity of online gambling in New Zealand has surged, particularly during the Covid-19 pandemic when physical venues were closed. True noted, “Online gambling is very, very popular in New Zealand and we saw a massive explosion with Covid-19 and our physical venues locked down. That’s really continued [since].” Currently, Tab NZ is the only legal online betting operator in the country, operating in partnership with Entain.

Regulated Online Casino: A Government Priority?

The government’s decision to launch regulated online casinos by early 2026, a general election year, suggests that this initiative is a priority. True remarked, “As far as saying it will be in place by early 2026, that is effectively prioritising the legislation.” However, he also pointed out that the legislative process will be lengthy, with the draft legislation expected to be released later this year, followed by a public consultation in 2025.

The New Zealand government is seeking input from international stakeholders to gain insights into regulatory frameworks from other jurisdictions. Despite this, many details about the regulatory process remain unclear, including the number of licenses to be issued and the associated costs. True mentioned that land-based operators like SkyCity Entertainment Group might have lobbied for limited online licenses to secure a larger market share.

SkyCity and Skyline Entertainment have already ventured into the online space, launching Malta-licensed casinos. SkyCity operates through a white label partnership with Gaming Innovation Group, while Skyline’s ChristchurchCasino.com is powered by White Hat Gaming.

Initially, the regulator considered having no cap on online licenses to minimize gambling-related harm. However, True criticized the auction-based limited license approach, stating, “Although the government will make a little bit of money out of an auction, I think it’s very shortsighted.” He also suggested that the policy could be reconsidered during the public consultation phase if stakeholders express significant opposition.

One policy that has already been established is a ban on gambling sponsorships, which True described as “very left-field.” He speculated that this decision was driven by a particular individual in the cabinet who was keen to make a mark on the legislation.

Source:

New Zealand government expects $500m regulated icasino market, igamingbusiness.com, August 9, 2024.

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