New Zealand’s iGaming Legislation: Prospects and Challenges Ahead
In July, New Zealand’s parliament passed a pivotal bill aimed at regulating online gambling, yet legal analysts caution that its vague instructions could hinder the anticipated rollout of the iGaming market by 2026.
Experts have voiced concerns that the Online Casino Gambling Bill appears somewhat rushed, lacking essential details necessary for a timely launch. Following its initial reading and subsequent approval by 83 votes to 39, the bill now advances to the Governance and Administration Committee, where industry consultations will commence to gather vital feedback.
Once this legislation is finalized, it is projected that up to 15 licenses will be granted, paving the path for New Zealand’s regulated iGaming landscape expected to launch by mid-2026. However, with such a tight timeline, industry experts fear the limited consultation period may impede thorough regulatory drafting.
Jamie Nettleton, a partner at Addisons, notes, “The bill is quite broad and misses critical details regarding licensing procedures. The timeline is definitely ambitious.” Samuel Gauci, also from Addisons, echoes this sentiment, stressing that if the June 2026 launch date remains unchanged, there won’t be enough time for effective consultations.
Budgetary Concerns for Operators
One pressing issue for potential operators is the ability to effectively budget for entry into the auction process scheduled for February 2026. The current lack of clarity surrounding regulatory specifics complicates decision-making for companies weighing the costs and benefits of participation.
“This really feels like a gamble,” remarks Nettleton. “The government hopes to attract 15 operators, but the question remains: how will they achieve this target economically? Competition is fierce and pricing strategies will be paramount.”
Key Aspects of the Bill
Introduced by Brooke van Velden, New Zealand’s Internal Affairs Minister, the bill stipulates that operators will be liable for a goods and services tax, along with an offshore gambling duty set at 12%. Moreover, they must contribute 1.24% of profits to a levy designed to fund services aimed at reducing gambling-related harm.
While gambling advertising can proceed with restrictions, such as prohibiting ads during times when children might be viewing, the full scope of these measures remains unspecified. Industry expectations suggest that certain advertising methods, including celebrity endorsements, may face bans, but the regulations are still subject to further definition post-legislation.
“Operators are in need of clear guidelines; the current bill doesn’t provide enough certainty for them to decide on participation,” observes Gauci.
Political Landscape and Its Implications
Since the 2023 elections, New Zealand’s political scene has shifted, with a coalition government now at the helm. This transition has renewed discussions about gambling regulations, particularly as the coalition has sought to leverage the online gambling sector as a revenue source amid economic challenges post-COVID-19.
Jarrod True, a legal expert at True Legal, believes that the centre-right government is more inclined to entertain expanded gambling legislation, partly due to economic recovery efforts. “Had a left-leaning government taken charge, the chances for such a bill would have been slim,” he notes.
Messaging Discrepancies
The government’s positioning to liberalize the iGaming sector while simultaneously tightening restrictions on the sports betting market raises eyebrows. Nettleton points out the inconsistency, noting that initial interest in New Zealand as a licensing destination revolved around broader operational freedoms beyond just lotteries.
True emphasizes the high regard for New Zealand’s racing industry, a sentiment echoed in political support that could lead to conflicting regulatory approaches in the gambling ecosystem.
Future Steps for the iGaming Bill
If the bill progresses through the Governance and Administration Committee, it will move to a second parliamentary reading, with finalization anticipated by mid-November. However, opposition remains a concern, particularly from sectors advocating for stronger gambling harm reduction strategies.
Prior to the vote, several politicians, including Labour’s Lemauga Lydia Sosene, voiced apprehensions regarding adequate plans for addressing gambling-related issues. The local land-based gaming sector may also resist impending regulations, especially challenging due to new online operators not being subjected to the same community-focused profit distribution.
“Implementing these regulations will undoubtedly be complex,” says True. “The government could face significant opposition from organizations focused on gambling reform, advocating for stricter advertisement bans.”
Addressing Black Market Risks
Ultimately, Nettleton asserts that while regulating iGaming is a prudent step, further measures must be enforced to mitigate the risk of a black market emerging. “The creation of a regulated market is a positive move, as it brings more oversight. However, if entering the market is overly complex, it could inadvertently drive operators underground,” he warns.
The challenge lies in finding a balance that allows for healthy market participation without incentivizing illegal alternatives. The looming question remains: will New Zealand’s iGaming ambitions translate into a thriving, well-regulated market? Only time will tell as the details unfold.