Synthetic Lotteries in the News — Weekly Round-up for October 13, 2017

By Brian Cullingworth, Last updated Oct 13, 2017

Tasmania Government To Ban Lottery Outcome Betting

Island province joins South Australia in drafting banning legislation

The Tasmanian government has ordered the drafting of legislation designed to ban lottery outcome wagering in the Australian island province, one of the first to take this action since online lottery provider Lottoland started making waves in the country.

Tasmania follows the lead of South Australia in taking the prohibition route, with New South Wales and Victoria reportedly also considering similar action.

Lottery outcome wagering, labelled “synthetic lottery” in the land Downunder, is an online gambling model where players bet on the outcome of an official lottery rather than directly buying tickets in it.

Predictably, the Australian Lottery and Newsagents Association applauded the government decision, with Tasmanian general manager Ben Kearney voicing concerns about the proliferation of online bookmakers and their push to capture customers of existing registered lotteries.

The Tasmanian Parliamentary Secretary for Small Business, Roger Jaensch, had earlier announced that the provincial government would draft legislation immediately to ban lottery outcome wagering, revealing that in doing so it would consult with other Australian states.

“It could prove difficult to control on a state level, but South Australia has done it. We will start technical and legal work straight away,” he said. “There is a difference between buying a ticket in the lottery and online gambling where consumer protections do not apply. This form of product is not welcome here.”

Now Western Australian Government Moves Against ‘Synthetic Lotteries’ (Update)

Lottoland is increasingly finding the going in Australia is tough

Despite last-minute pleas from Lottoland CEO Luke Brill this week, the Western Australian provincial premier, Mark McGowan, has decided to join other Australian states and territories in imposing a ban on “synthetic lotteries” in general and Northern Territory-licensed but Gibraltar-based Lottoland in particular.

McGowan did not mince his words, describing online synthetic lotteries as “a menace” to the his province’s traditional lottery and claiming that the former contributed nothing to the state and was there to make profits and grow.

Earlier this week Brill, clearly fighting a last ditch defence for his company, said that Lottoland was supportive of proposals in Australian states to introduce a 15 percent “point of consumption” tax. He went further, offering to start paying the tax immediately as various provinces gear up to introduce their banning legislation.

“We believe that 15 percent can then flow through to good causes here,” he said, rejecting activist claims that his company was the reason for a A$60 million drop in WA lottery revenues last year.

“It’s nothing to do with Lottoland. We can’t move the dial – we’re not big enough in WA yet,” he said.

Lottoland reportedly has just 6,000 Western Australia punters, but many more in other Aussie states and territories.

In related news, Australia’s corporate regulator, the Australian Competition & Consumer Commission, has waved off a Labor Party proposal that it should investigate whether Lottoland has infringed any consumer laws.

Labor contended that ‘synthetic lottery’ companies like Lottoland offer bets on lottery results that could mislead or deceive consumers into believing they were purchasing a lottery ticket or directly participating in a lottery.

ACCC chairman Rod Sims acknowledged there were concerns related to the issue, but pointed out that gambling in Australia is primarily regulated by the individual states and territories.

“Questions about the responsible conduct of gambling should be referred to the relevant state authority,” a spokesman for the ACCC said.

Lottoland has paid the price for its success in Australia, becoming a target for a A$5 million campaign launched by the Australian Lottery and Newsagents Association, backed by rival Tatts Group. The campaign argues that online bookmaking sites that offer bets on lottery outcomes threaten state lottery tax revenue and hurt retail ticket sellers such as newsagents.

---