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UK and US Markets Set the Standard for Gaming Regulation in New Zealand

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The New Zealand government’s decision to allocate 15 licences to online casino operators will transform how Kiwis engage with the gambling industry.

The authorities are working on establishing a new regulatory framework which will likely take plenty of cues from established markets such as the United Kingdom and United States.

While both nations operate different models for gaming, New Zealand can analyse their operations to create an effective, equitable and sustainable system.

The UK’s Robust Regulatory Framework

The UK’s Gambling Act of 2005 is one of the most comprehensive online gambling regulatory frameworks in the world.

The UK Gambling Commission (UKGC) keeps operators in line and ensures they adhere to strict rules around licencing, consumer protection and responsible gaming.

There are numerous elements from their playbook that New Zealand can adapt for themselves, including the focus on consumer protection. 

The UKGC is keen on player safety, enforcing measures such as self-exclusion, affordability checks and tight advertising guidelines.

New Zealand must consider this as the blueprint for its model. The UKGC holds operators accountable, mandates constant audits and ensures transparency in operations.

Operators who err are slammed with hefty penalties, and they can even have their licences withdrawn if they fail to live up to expectations. 

New Zealand plans to slap a NZ$5 million fine on any operator that falls out of line. They should also consider enforcing regular audits to maintain the integrity of the ecosystem.

Navigating a Patchwork of US State Regulations

The gambling regulations in the US vary from state to state. While this decentralised system creates some confusion, there are lessons New Zealand can learn.

States in the US, such as New Jersey, have shown that a well-regulated casino market can help bolster tax revenue for the government.

New Jersey’s gambling industry registered over $1.6 billion in gross revenue in 2022, and a sizeable chunk of that money went to the state coffers. 

New Zealand must also incorporate New Jersey’s transparency in reporting tax revenue and reinvestment into public services. 

The US market has been driven by technology. US casino operators use advanced geolocation and identity verification tech to comply with state laws and prevent unauthorised access.  

New Zealand also wants to install age verification systems that prevent minors from having betting accounts, ensuring that only eligible players can participate.

Another reason the US succeeded with its regulatory model across states is the encouragement of collaboration amongst all parties, from operators to regulators and advocacy groups.

They hold stakeholder meetings regularly to ensure that the rules in place are constantly being adapted for any challenging scenarios.

New Zealand’s regulatory body must always have a clear line of communication with licensees and community leaders to build trust and ensure that everyone voices their concerns.

Striking a Balance & Addressing Societal Concerns

The decision to limit the number of online casinos in New Zealand to 15 is a wise move that allows the government to maintain control of the sector.

The plan for NZ is to funnel players towards the licenced casinos, making them choose legal outfits over potential unlicenced off-shore operators.

However, they must ensure that releasing these few licences does not limit competition or innovation. The process of auctioning the licences must be fair and transparent.

They must allow different types of operators to acquire licences, from smaller online casinos in New Zealand to global gaming giants such bet365 and 888. 

Another point of consideration is the taxation rate. New Zealand must introduce a tiered tax rate for operators based on size and revenue to stop the big companies from cornering the entire market.

Licenced operators must undertake regular performance reviews to meet consumer protection and harm minimisation standards.

While the main reason for ratifying the gambling industry in New Zealand is the economic benefit, potential social issues cannot be ignored.

New Zealand Internal Affairs Minister Brooke van Velden believes they must focus on harm minimisation. This can only be achieved when proactive measures are put in place.  

Educating individuals on responsible gaming can help reduce stigma and encourage them to seek help when needed. Addicted gamblers need counselling and support funded by operators. 

Continuous studies on gambling behaviour will enable policymakers to refine regulations and address emerging risks, thus helping the country maintain a sustainable framework for gaming.

TXH
TXH
TXH loves nothing more than kicking back at the end of the day, controller in hand, shooting the hell out of strangers via Xbox Live.

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