iGaming Legislation in New Zealand Explained

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There is no question that iGaming is growing rapidly. If ignored the industry can be harmful to society. If embraced, the industry potentially offers many opportunities, including a source of tax income. As such the New Zealand Gambling Act was passed in 2003, officials decided that it was better to regulate gambling rather than outright ban it.

The Gambling Act is very specific about how casino games are handled. The law prohibits some forms of gambling while carefully restricting others. The Gambling Act is also very clear about who is allowed to gamble. Importantly the legislation is updated at regular intervals. Most recently, alterations were made to include iGaming. 

Looking closer the Gambling Act breaks down casino games into various categories; Class 1, Class 2, Class 3 and Class 4.

The 4 Casino Game Categories

Class 1 games include those that don’t involve commission sharing between the operator and the player. New Zealand gambling operators offering the games must be authorized, and only authorized persons should deal with players. Any prizes offered should not exceed a value of $500. This includes awards in the form of money or prizes. Any money made by operators from the games must be utilized according to the law. Importantly offering these games does not require a specific license. All appropriate laws must still be followed.

Class 2 games follow most of the same rules as Class 1. The gambling activities must still not include any commission between operators and players. Both cash and non-cash prizes must not exceed $5,000. The added stipulation in Class 2 is that turnover for the gambling operation must not exceed $25,000. Also required is that only registered persons may offer the games. A player must not only be given a clear description of the game but also full information on the operator must be shared. The information must include the operator’s name, the offered rewards, as well as the retail value of a non-cash prize.

Class 3 is where commission between the player and operator is allowed. As such the operation is closely overseen by the Department Of Internal Affairs. Before being allowed to offer the games the department must verify that the operation is financially feasible. This class generally includes games such as lotteries and Housie. Prizes offered must not exceed $5,000. Gambling machines of any kind may not be used. A big restriction is that funds raised with the games should be returned to the community. Hence the general purpose of Class 3 gambling is to raise funds for community projects.

Class 4 is where the most commonly known casino games are found. iGaming also falls into the Class 4 category. This means that slots, electronic Roulette, Video Poker and other such games are included here. Only corporate operators can offer services on this level. These games may not be offered under any other class, with penalties for breaching the law being harsh. Again, profits made with these operations are intended for community project use. Any operator intending on offering class 4 games must prove to internal affairs the purpose of the profits.

The Purpose of the Laws

The New Zealand government has extended great care with the above legislation. Any activity involving games of chance is carefully considered and categorized accordingly. These measures aim to keep locals safe. If not properly regulated gambling can be very harmful.

It is important to note that the laws don’t prohibit locals from using foreign iGaming sites. Although the laws apply to iGaming operations within the country offshore sites are not included. This means that New Zealanders may use sites run by foreign companies. The caveat is that the government is also not responsible for regulating these sites. As such, local gamblers using foreign sites must demonstrate caution. An important step is to check that every casino is licensed.

Most foreign-operated online casinos are licensed. Even still some fraudulent sites exist on the internet. For this reason, it is essential that New Zealanders make use of trusted casino review sites. A review site is aimed at weeding out illegal operations. Thus, New Zealanders can gamble safely online without the risk of getting scammed.

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