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Australia To Have Legal Cybercasinos

4 October 1997

The Australian Financial Review Newspaper reports in a story by Gaming Industry writer David Crowe that "Proposals that would transform the Internet into a multibillion-dollar gambling venue have received a major boost from [The Australian] State and Territory governments, which announced on Friday an in-principle agreement to push ahead with interactive home gaming."

The Financial Review says "The agreement gives existing casinos provisional clearance to extend their services to the Internet, offering card games and new types of wagers to anyone with a connection to the worldwide network. Launched properly, the online gaming services would draw customers from outside Australia, particularly in Asia."

In a press release, The Victorian [State] Minister for Gaming, Mr. Roger Hallam, said the States and Territories had endorsed a new regulatory model and a "cooperative approach" for legislation in each jurisdiction. Mr. Hallam said the framework would limit the impact of overseas gaming sites, which are proliferating on the Internet from their bases in the Caribbean and the South Pacific.

Australian laws would only allow "creditable and well-regulated products" to be used in Australia and would impose "strict advertising and marketing controls", according to the plan.

While some states would have preferred to take a more cautious approach, pressure on the pro gambling Government from the Victorian gaming operators to be let loose on the world stage made it clear that Victoria may act alone if a national agreement could not be put in place. Already the Victorian Tattersalls' gambling group have been operating a cybercasino under the guise of a sales promotion and have had play from all around the world (including the USA something Messers Doyle, HHH 3.0 et al might like to ponder). The Tattersalls site was designed by Sydney Software house Access systems.

According to the Financial Review, a spokesman for Crown Casino in Melbourne, Mr. Gary O'Neil said "We're on top of virtually every aspect of it, but we haven't made a commitment yet." The Financial Review speculates that "Some gaming experts suggest that Crown could launch a web site restricted to its Asian high-rollers, holding funds at the casino to avoid transferring money over the Internet. Crown Casino says that so far it had limited its work to research on the market potential and technology.

RGT's sources say Victoria is prepared to enact legislation next year to license home gaming services, alone if necessary. This may prove to be more optimistic than these statements lead you to believe as there has been a proliferation of gambling in Victoria in recent and a public and political backlash is looming. This just might envelope Victorian cybergaming before it gets off the ground. The end result may be that some of the smaller Australian states such as Tasmania or the Northern Territory may take the lead. Already over the Net sport betting is allowed in the Northern Territory at the Alice Springs based Centerbet. Horse racing and sports bets can also be placed on line at the New South Wales TAB and the West Australian TAB.

Friday's announcement resolves the most contentious issue behind Internet gambling in Australia -- where to apply State taxes. Under the draft framework, the tax would be paid by the gambler in his or her home State, even if the casino was located elsewhere in Australia. Taxes generated from overseas players, it seems, will be paid to the state in which the cybersite is licensed.

The question of if there will be new players allowed to operate stand alone cybercasino sites is not clear. The implications from the infomation available so far is that the licencing process will be the same as real world Casinos and that cybercasino licences may be resricted to current Casino operators. If this is so, it will come as disapointment to many would be operators who would have started booking their airtickets to Australia at the beginning of this story.

RGT will try to dig out more detail on the decision and the implications and post them as soon as possible.

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