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Lottoland back in the game after court ruling

Tue, Aug 20, 1:13pm by Staff Writer

Online lotto operator Lottoland has successfully overturned a government ruling that had threatened to end its business in Australia by declaring its products illegal.

The Sydney Morning Herald reports that the New South Wales Supreme Court ruled last Friday in favour of Lottoland in a claim brought against it by the Australian Communications and Media Authority.

The Herald reported in June that the federal media watchdog’s investigation centered on Lottoland’s “jackpot betting” product which determines winners by pulling numbers from financial markets including the New York Stock Exchange at opening time, arranging them into one long number and using a computer calculator to convert it into the winning numbers.

“The Australian Communications and Media Authority investigation found that several Lottoland online jackpot betting services were games of chances which are prohibited,” the regulator said.

“These included the Mon and Wed Jackpot, Tue Jackpot, Thu Jackpot, US Millions, and US Power jackpot betting services.”

The decision is a fresh blow to the embattled business in Australia.

The company only recently began offering the exotic jackpot betting product after its main product, lottery betting, allowing punters to place bets on the outcomes of local and overseas lotteries without having to buy a ticket in any draw, was outlawed by Australian parliament last year.

ACMA identified supposed breaches in June

The ACMA found in June that Lottoland’s products – Mon & Wed Jackpot, Tue Jackpot, Thu Jackpot, US Millions and US Power – breached Australian laws which outlaw online betting on the outcome of a “game of chance.”

The Gibraltar-based Lottoland offers, “jackpot betting” in which participants submit a set of numbers similar to traditional lotto, but the winning combination is determined by the results of financial market indices rather than by balls being selected from a pit.

Lottoland only started offering its “jackpot betting” late last year after the Australian government outlawed its previous product, which let customers bet on the outcome of local or international lotto draws without buying a ticket.

The laws in question, the Interactive Gambling Act, were put in place in 2001 to address concerns that the rise of the internet could deepen the damage caused by problem gambling by putting a “virtual poker machine in every home.”

Justice John Sackar, noting that the legislation was “not all that easy to construe”, ruled that Lottoland’s products were permitted under the act because they consisted of betting on the outcome of an “event”, not a “game”.

A provision for “events” in the law is what permits online betting on election outcomes, for example.

Justice Sackar acknowledged Lottoland customers had very little participation in the service but said the products had none of the “traditional elements of games”, such as competition, entertainment or amusement.

While roulette – which cannot be gambled on online under the law – also selects winning numbers at random, that was a “game” because it involves players choosing a number or colour that was lucky or special to then, while competing against a casino or other punters which give it a “a level of interaction”, Justice Sackar said.

“A game must, in my view, be more than the simple process by which a person parts with his/her money with a chance of finance return,” he said.

ACMA chair Nerida O’Loughlin said the authority would “give careful consideration to the judgment and its implications for Australia’s online gambling regulation.”

Lottoland Australia’s chief executive Luke Brill said that the group had always maintained that its products complied with the law, and that ACMA’s view was “wrong, unfair and uncompetitive.”

“With the matter now settled, Lottoland Australia can finally get on with what it does best – providing new and exciting products that Australian punters love,” he said.

Lottoland has faced a storm of opposition since it opened in Australia in 2014, especially from newsagents and government licenced lotto operators, who argue Lottoland is cutting into their business and eating away at millions in government tax revenue.


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