Entain Commits Potential Breach of NZ Gambling Act Following Historic 25-Year Deal with TAB

Robert Longthorpe - Senior Writer
Robert Longthorpe
13 June 2023 in News
Entain Commits Potential Breach of NZ Gambling Act

We here at NZCasinoClub.com bring you all the important gambling news going on in New Zealand and Australia. We previously talked about Entain being set to secure a deal for New Zealand sports betting but now it's gone through and there are already issues.

Entain's Historic Deal with TAB NZ

Entain, the international gambling powerhouse and owner of Ladbrokes, has set a new precedent by forging a remarkable 25-year strategic alliance with New Zealand's TAB (Totalisator Agency Board). The publicly-traded London-based company pledged an eye-catching $900 million to be invested in the New Zealand racing industry over the forthcoming five years, outmaneuvering rival bidders like Tabcorp and Sportsbet. This unparalleled deal gifts Entain control of TAB's betting and broadcasting responsibilities for the next quarter-century.

New Zealand's Minister for Racing, Kieran McAnulty, sanctioned the agreement on Tuesday, a couple of months post Entain's selection as the favoured bidder. The revelation followed a persistent lobbying effort by Entain to extend TAB's sports and racing betting monopoly into the digital space. Entain offered an initial payment to ward off unlicensed overseas competitors from gambling in New Zealand.

The Benefits of the Alliance

Dean Shannon, Entain Australia's CEO, hailed the alliance as a transformative development for the country's sports betting landscape. Shannon voiced his confidence that the alliance would generate considerable financial returns for New Zealand's racing codes and national sporting bodies.

The deal includes an initial payment to TAB NZ and a five-year promise of minimum yearly payments totalling $900 million. TAB NZ's chair, Mark Stewart, remarked that these financial commitments constituted a significant uplift from this year's distribution of $125 million.

Adding to the appeal of the deal, the partnership commits $15 million to NZ's national sporting bodies by 2025, alongside a $500,000 payment to Sport NZ dedicated to bolstering women's sports.

Violation of NZ Gambling Act

Despite the alliance's promising outlook, Entain, now in charge of TAB, appears to have encountered an early stumble, infringing the New Zealand Gambling Act within a week of receiving ministerial endorsement.

The infraction originated from an email sent on May 29 by Entain's subsidiary, Party Casino, to a client in New Zealand. The email advertised a free sports betting offer, an action contravening section 16 of the Gambling Act 2003 that prohibits the promotion of overseas gambling.

The antiquated Gambling Act, now 20 years old, leaves the Department of Internal Affairs somewhat handicapped in dealing with such violations from foreign providers. Andrée Froude, the spokesperson for industry watchdog, the Problem Gambling Foundation, rebuked offshore operators for exploiting legal grey areas to market their services.

Confronting the Advertising Violations

When questioned about these advertising contraventions, an Entain representative highlighted the broader issue of online gambling regulation in New Zealand. They pointed out that there are no existing laws that prevent offshore casino operators or betting providers from conducting business with NZ residents. Nonetheless, the representative confirmed that following ministerial endorsement, Entain initiated the closure process for New Zealand users interacting with subsidiary brands like Party Casino and Bwin.

Kieran McAnulty, the Racing Minister, reaffirmed that the newly operating TAB entity must abide by all New Zealand laws, including the Gambling Act 2003. He mentioned his special consideration for the Act's harm minimisation requirements while examining the alliance. McAnulty expressed belief in Entain's capacity and reach to deliver superior harm minimisation compared to the existing scenario.

The Bigger Picture

Beyond Entain's potential violation of the Gambling Act, the incident brings to light the broader issue of online gambling regulation in New Zealand. The country currently lacks an all-encompassing legislative framework to govern online casinos, making it an attractive prospect for overseas gambling sites. The increasing necessity for an updated legal system to oversee the booming online gambling market is clear, and how regulatory authorities address these imminent issues in the future remains a matter of anticipation.

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