Australia Weekly Round-up — May 19, 2017

By Brian Cullingworth, Last updated May 25, 2017

Aussie P.O.C. Gambling Tax On Hold Until National Gambling Framework Is In Place (Update)

Once implemented, new tax will deliver hundreds of millions of dollars to state and territorial governments

The recent agreement between federal, state and territorial governments in Australia on the imposition of a point-of-consumption tax on online gambling (see previous InfoPowa reports) was in the headlines again Thursday when the Victoria provincial newspaper Herald Sun reported that the state government stands to take in A$150 million when the new tax is implemented.

InfoPowa readers will recall that the p.o.c. tax concept was introduced last year by South Australia, and was positively received by most of the other states and territories at meetings earlier this year.

The Herald Sun reports that Victoria has agreed with other states and territories to hold off on implementation until a national online gambling framework – for regulation and taxation – has been explored, debated and agreed.

That hasn’t stopped the Victorian treasurer from including online gambling tax estimates in his budget papers, the newspaper reports.

The current status is that state, federal and territory treasurers have agreed that each will model how a nationally consistent point of consumption tax could work and report back to a further meeting.

Any tax would have Commonwealth oversight, a recent communique revealed.

G.I.G. Exits Aussie Online Gambling Market

Affiliates advised that Gaming Innovation Group brands will no longer be offered to Australian online punters

Major online gambling operator Gaming Innovation Group has advised its marketing affiliates that effective May 15 it will no longer accept Australian online punters.

The decision applies to popular online casinos like Guts, Betspin, Rizk, Thrills, Kaboo, and SuperLenny and is understood to be related to forthcoming law and regulatory changes imposed by federal and state governments in Australia that have prompted a growing number of top operators to withdraw (see previous InfoPowa reports).

The question on most players’ lips now is when Pokerstars-Amaya will join the exodus; the company’s CEO, Rafi Ashkenazi suggested earlier this year that this may be necessary.

Tatts-Tabcorp Cite Heavy Online Competition As Justification For Merger

Australian Competition Tribunal hears evidence on proposed merger of two Aussie gambling giants

Legal representatives for Tatts and Tabcorp argued today before the Australian Competition Tribunal that their proposed merger was necessary to compete in a local market where growth is now dominated by foreign-owned companies with local online subsidiaries such as Paddy Power-Betfair, William Hill and Ladbrokes Coral. They included local gambling giant Crown Resorts online subsidiary CrownBet in the roster of serious competition their principals are facing.

Lawyers cited the extensive and aggressive marketing and promotional activity, along with major sporting sponsorships and competition for racing and other media rights which the market has seen from vigorously competitive gambling companies.

Three of high profile opponents of the merger – CrownBet, Racing Victoria and — will be giving evidence during the hearings. All three have argued that a completed merger between Tatts and Tabcorp would result in a significant loss of competition within the Australian gambling industry.

The Tatts-Tabcorp claims that the Australian Competition and Consumer Commission is siding with Racing Victoria, Crownbet and, having used evidence from the objectors in a report it recently lodged with the ACT, was rejected by ACCC legal representatives..

They said that both the ACCC and the interveners had filed evidence consistent with issues raised by the competition watchdog, which has described the public benefits and $130 million in annual synergies Tabcorp claims could result from the merger as “overstated”. The lawyers further pointed out that the objectors’ evidence and arguments were relevant even if they are trade rivals with Tabcorp.

“By casting the ACCC as its opponent in its submissions, Tabcorp appears to misunderstand the role of the ACCC in this matter. Further, the assertion by Tabcorp that the ACCC has engaged in speculative theories of harm is pejorative and without foundation,” the legal representative asserted.

“The ACCC is the only party to the proceeding without a vested interest in its outcome.”

Tatts Acquires Stake In Jumbo Interactive

Expands long-term commercial relationship for a further 5-years

Tatts Group Limited has invested in a 15 percent stake in internet lottery business, Jumbo Interactive Limited and extended its long-standing lottery reseller agreement for a further five-years.

In addition, under the terms of the new agreement, Tatts will provide an expanded product portfolio to include the popular “Set for Life” game.

Tatts purchased 6,609,686 newly issued fully paid ordinary shares in Jumbo at $2.37 per share, raising $15.66 million in equity capital.  A further 12-month option enables Tatts to acquire a further 3,474,492 ordinary shares, subject to shareholder approvals.

While Tatts has declined to join Jumbo Interactive’s Board of Directors at this time the offer remains for as long as Tatts retains at least a 10 percent shareholding interest in Jumbo.

Brian Cullingworth

Infopowa news was a staple of Casinomeister’s news from 2000 until 2019. Brian Cullingworth was the main writer, contributor, and was one of the most knowledgeable persons I have ever known involved in the online casino industry.

We first met in January 2001 at the ICE in London where I observed him going booth to booth interviewing online casino, software, and licensing jurisdiction representatives. Brian was also heavily involved with our forum as “Jetset“, he was involved as an informal consultant to eCOGRA, the OPA, and was a player advocate who assisted countless aggrieved players with his connections to industry folks. He also published “Casino Cautions” via Infopowa news for quite a number of years. These can be found in our news archives.

His passing in February 2019 was a dark day for us. He will be forever missed.

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