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Australian Senate Delivers Blow to Online Gambling

6 December 2000

The online gambling industry suffered a major setback today when Australia's Senate passed the federal government's bill to impose a 12-month moratorium on new forms of Internet gambling, retroactive to May 19.

The bill prevents new licenses for online casinos, and prevents the holders of licenses issued prior to May 19 from offering additional gambling products. It will also affect several sites which began operating after May 19.

Some operators had threatened litigation if the bill passed, arguing that their businesses were legal when their sites launched. They may demand compensation.

Voicing concern about problem gambling in Australia, the federal government has targeted online gambling, hoping that the moratorium will lead to a permanent ban. It has not taken action regarding the thousands of slot machines in the country.

The federal leadership also compromised to permit continued online wagering on sports events and horse races. That apparently helped it achieve passage in the Senate, which had defeated the moratorium in October on a tie vote.

Peter Bridge, managing director of Lasseters Holdings, denounced the action as a "giant step backwards." Lasseters Online began operating Australia's first licensed, regulated casino in April 1999.

Bridge said more operators of online gambling sites will move offshore, where there is little or no regulation.

Here is the text of Bridge's statement:

"We are stunned by the double standard established by the Federal Government through the passage of this Bill. The Government says it is concerned about the risks of problem gambling. But this Bill endorses wagering with operators who have the lowest standards of player protection, even though the risks are the same if not higher.

"Research conducted by the Productivity Commission found that racing resulted in three times as many problem gamblers as casino style games. Wagering is just as much a cause of gambling problems as any other form but these few operators are now conveniently excluded from being part of the solution.

"This is a giant step backwards in the effort to establish consistent national regulation of all forms of online gaming. Player Protection Bills have been passed in many states but these are now irrelevant with the passage of this retrograde decision which amounts to a 'No Player Protection Bill'.

"The tragedy is, the casino operators who have done all the right things in establishing responsible, regulated online gaming, are the ones who are most discriminated against through this Bill. It is only these operators who set betting limits, require proof of identity and offer self exclusion facilities.

"Lasseters Online commenced operating as Australia's first regulated online casino 18 months ago. We have established the highest standards of regulation and shown they are effective in protecting players' interests.

"When Lasseters Online developed its controls, our Northern Territory Government regulators went to the wagering industry and asked them to lift their standards to our level.

"This moratorium is a significant threat to our international competitiveness."

"The moratorium will prevent us from upgrading our site as new technology becomes available. It will also prevent us from extending the variety of gaming products offered. This is critical to retaining and attracting players particularly as Internet usage grows in new markets worldwide.

"It is difficult to run a business as diverse as Lasseters Online with so much government uncertainty. To change our site to reflect its status in May will lose seven months of continual development.

"As responsible operators, we will comply with the moratorium. But we will be looking at all our alternatives to ensure Lasseters Online can continue to grow.

"We expect to start seeing more operators moving offshore because of the position being taken by the Federal Government in Australia."

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