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2022-2023
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
INTERACTIVE GAMBLING AMENDMENT (CREDIT AND OTHER MEASURES)
BILL 2023
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Communications,
the Honourable Michelle Rowland)
1
INTERACTIVE GAMBLING AMENDMENT (CREDIT AND OTHER MEASURES)
BILL 2023
GENERAL OUTLINE
The Interactive Gambling Amendment (Credit and Other Measures) Bill 2023 (the Bill)
amends the Interactive Gambling Act 2001 (the Act) to:
- prohibit the use of credit cards, credit related products and digital currency as
payment methods for interactive wagering services;
- create a new criminal offence and civil penalty provision related to the ban;
- provide the Australian Communications and Media Authority (ACMA) with
enhanced powers to enforce the ban and existing offences under the Act; and
- make several consequential changes and remove some spent provisions.
Background
In November 2021, the Parliamentary Joint Committee on Corporations and Financial
Services inquiry into the Regulation of the use of financial services such as credit cards and
digital wallets for online gambling in Australia (PJC Inquiry) recommended that the
Government implement legislation to ban online gambling service providers of wagering,
gaming and other gambling services (with the exception of lotteries) from accepting payment
by credit cards, including via digital wallets.
The PJC Inquiry received submissions from responsible gambling advocates, financial
counsellors and academics that gambling with credit can lead to significant and life-changing
consequences such as extreme financial hardship, loss of employment, bankruptcy, and
broader societal harms including the breakdown of relationships, mental illness and
homelessness.1 Beyond the individual gambler, these impacts can also affect their family,
friends, colleagues and employers. The PJC concluded that the current exemption under the
Act that permits independently issued credit cards to be used for online wagering is a 'glaring
omission in the current regulatory system'.2
It is estimated that around 15-20 per cent of online wagering is currently done with credit
cards and this cohort of customers is more susceptible and vulnerable to greater harms that
arise from gambling. Access to credit for online wagering, combined with the ease of
gambling using a digital device, such as a mobile phone, can result in large amounts of debt
accumulated in a short period of time. Gambling transactions are typically treated as cash
advances, and usually incur a higher rate of interest compared to regular purchase transaction
rates, which increases the burden of any losses.
On 9 May 2023, the Government tabled its response to the PJC Inquiry in Parliament in
support of a legislated ban on the use of credit cards for online gambling.
1
Report of the Parliamentary Joint Committee on Corporations and Financial Services inquiry into the
Regulation of the use of financial services such as credit cards and digital wallets for online gambling in
Australia, November 2021, pp.13-15.
2
Ibid p.34.
2
Purpose and operation of the Bill
The purpose of the Bill is to reduce gambling harms experienced by Australians by
prohibiting the use of credit cards, credit related products and digital currency as payment
methods for interactive wagering services.
The Bill will:
• prohibit an operator of a regulated interactive gambling service that is a wagering service
from accepting or offering to accept payments from a customer of the service who is
physically present in Australia using: a credit card; payments linked to a credit card
(including digital wallets); digital currency (such as cryptocurrency); or other methods
determined by the Minister by way of a (disallowable) legislative instrument;
• create a new criminal offence (500 penalty units) and new civil penalty provisions (750
penalty units) (enforceable under Part 6 of the Regulatory Powers (Standard Provisions)
Act 2014) and sets out the relevant evidentiary requirements and due diligence defences;
• expand the ACMA's compliance and enforcement powers to include receiving
enforceable undertakings and giving remedial directions to enforce the new and existing
civil penalty provisions under the Act, similar to other legislation administered by the
ACMA;
• introduce a six month transitional period to give banks and wagering service providers
time to prepare for and implement changes necessary to ensure compliance with the new
requirements;
• revise the definition of 'credit' under the Act;
• require the Minister to cause a review of the ban (and related measures in proposed Part 1
of Schedule 1 to the Bill) at the end of 2 years from commencement; and
• repeal existing section 15G which is now spent.
The Bill incorporates several of the ACMA's recommendations in its 2021 Report on the
Review of Part 2B of the Interactive Gambling Act 2001 - Credit betting prohibitions.
Consultation
In August 2023, the Department of Infrastructure, Transport, Regional Development,
Communications and the Arts undertook targeted consultation with stakeholders on the
exposure draft Bill. Stakeholders included banking and payment providers, wagering and
lottery operators, harm reduction advocates, academics and Commonwealth agencies.
Stakeholders widely support the policy objective of the Bill.
Financial Impact
The Bill is not expected to have any financial impact on Commonwealth expenditure or
revenue.
Regulatory Impact Analysis
The Office of Impact Analysis has determined that, as the Department certified that the PJC
Inquiry followed a similar process to that required for a Regulatory Impact Analysis, the PJC
inquiry can be found at
aph.gov.au/Parliamentary_Business/Committees/Joint/Corporations_and_Financial_Services/
Onlinegambling/Report (reference ID OBPR23-04188).
3
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Interactive Gambling Amendment (Credit and Other Measures) Bill 2023
The Interactive Gambling Amendment (Credit and Other Measures) Bill 2023 (the Bill) is
compatible with the human rights and freedoms recognised or declared in the international
instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
(Human Rights Act).
Overview of Bill
The Bill implements the Government's response to the recommendations from the
Parliamentary Joint Committee on Corporations and Financial Services inquiry into the
Regulation of the use of financial services such as credit cards and digital wallets for online
gambling in Australia (PJC Inquiry).
The Bill will amend the Interactive Gambling Act 2001 (the Act) to:
- modify the definition of credit and implement a ban on the use of credit cards, credit
related products and digital currency for interactive wagering services, and creates
criminal offence and civil penalty provisions related to the ban;
- provide the Australian Communications and Media Authority (ACMA) with
enhanced powers to enforce the ban and promote compliance with it and other
existing civil penalty provisions under the Act; and
- make several consequential changes and removes spent provisions.
The key public policy objective of the Bill is to minimise the significant gambling harms
experienced by Australians and reduce societal harms arising from interactive wagering
services through the use of credit cards and related credit products.
Human rights implications
This Bill engages the following rights under the International Covenant on Civil and Political
Rights (ICCPR):
• the right to health (Article 12 of the ICCPR); and
• the right to a fair and public trial or hearing, right to a presumption of innocence, and
minimum guarantees in criminal proceedings (Article 14 of the ICCPR);
Right to health
Article 12 of the International Covenant on Economic, Social and Cultural Rights recognises
the right of everyone to the enjoyment of the highest attainable standard of physical and
mental health.
The Bill promotes the right to health by facilitating a ban on the use of credit for online
wagering, which will meet a critical gap in consumer protections in Australia, and can assist
individuals who are at-risk of, or already experiencing harms to their physical and/or mental
health, from online wagering. This includes individuals who meet the clinical criteria of
Gambling Disorder (as per the Diagnostic and Statistical Manual of Mental Disorders).
4
Right to a fair and public trial or hearing, right to a presumption of innocence, and
minimum guarantees in criminal proceedings
New civil and criminal penalties and Article 14 of the ICCPR
Article 14 of the ICCPR recognises a number of rights in relation to criminal proceedings,
including:
• the right to a fair and public trial or hearing in criminal and civil proceedings, before
a competent, independent and impartial court of tribunal established by law (Article
14(1));
• the right to the presumption of innocence until the prosecution proves a charge
beyond reasonable doubt (Article 14(2)); and
• minimum guarantees in criminal proceedings, such as to be informed promptly and in
detail of charges (Articles 14(3)-(7)).
Item 9 of Schedule 1 to the Bill would insert a new subsection 15C(1A) into the Act that
represents a criminal offence provision (subsection 15C(1A)). A person commits an offence
if they intentionally provide a regulated interactive gambling service that is a wagering
service and accepts or offers to accept payment in connection with the service using a method
mentioned in new subsection 15C(4A) of the Act from a customer, or a prospective customer,
of the service who is physically present in Australia.
A regulated interactive gambling service is defined in the existing section 8E of the Act and
covers wagering services (except for online in-play sports betting services and betting on the
outcome of lotteries, which are prohibited under the Act) and lottery services (except for
online instant or scratch lotteries, which are also prohibited).
Item 13 of Schedule 1 to the Bill would also create new civil penalty (new subsection
15C(3A)). A person would be in contravention of this new provision if they provide a
regulated interactive gambling service that is a wagering service and accepts or offers to
accept payment in connection with the service using a method mentioned in new subsection
15C(4A) from a customer, or a prospective customer, of the service who is physically present
in Australia.
As Parts 4, 5 and 7 of the Regulatory Powers (Standard Provisions) Act 2014 (Regulatory
Powers Act) apply to the Act and will continue to apply to the Act after the amendments set
out in the Bill were enacted, the amendment would mean the ACMA would be authorised to
apply to a relevant court for a civil penalty order requiring a person to pay the
Commonwealth a pecuniary penalty for a contravention of the Act under Part 4 of the
Regulatory Powers Act. The pecuniary penalty is set at 750 penalty units for a contravention
of new subsection 15C(3A).
The ACMA could apply to the relevant court for an interim injunction or an injunction to
restrain a person from engaging in conduct and/or requiring that person to do a thing in
relation to acts or omissions that would constitute a contravention of the civil penalty
provisions in the Act.
5
New criminal offence and Article 14(2)
Article 14(2) provides that everyone charged with a criminal offence shall have the right to
be presumed innocent until proven guilty according to law. This imposes on the prosecution
the burden of proving a criminal charge and guarantees that no guilt can be presumed until
the charge has been proved beyond reasonable doubt.
Item 18 of Schedule 1 to the Bill would engage, but not limit, the rights to a presumption of
innocence under Article 14(2) of the ICCPR.
Offences that contain 'reverse burden' provisions may amount to a limitation on the
presumption of innocence because a defendant's failure to establish an absence of fault (for
example, through a mistake of fact defence) or to discharge a burden of proof, may permit
their conviction despite reasonable doubts as to their guilt. This includes where an
'evidential' or 'legal burden' defence is created by expressing a matter to be a defence or an
exception to the offence, or providing that the defendant must 'prove' the matter.
Proposed subsection 15C(5) would create an exception to the new criminal offence and civil
penalty provision in proposed subsections 15C(1A) and (3A) respectively where a person did
not know, and could not, with reasonable diligence, have ascertained that the person was
accepting, or offering to accept, payment using a method mentioned in new subsection
15C(4A). The note to subsection 15C(5) provides that a person who wishes to rely on this
subsection bears an evidential burden in relation to the matter in this subsection (see
subsection 13.3(3) of the Criminal Code and section 96 of the Regulatory Powers Act).
This means the defendant must raise evidence that their conduct fell within the exception. If
the defendant discharges this evidential burden, the prosecution must disprove the matter
beyond reasonable doubt.
Placing the evidential burden on the defendant in this case is appropriate as the matter
required to be established--whether the person did not know, and could not, with reasonable
diligence, have ascertained that the person was accepting, or offering to accept, payment
using a method mentioned in new subsection 15C(4A) -- is best proven by the defendant.
The Bill would not otherwise alter the process that would apply to the investigation or
prosecution of the new criminal penalty as compared to other offences under the Act or under
Commonwealth law generally. The quantum of the penalty (500 penalty units) is appropriate
to the seriousness of the conduct. This measure does not otherwise engage the rights in
Article 14 of the ICCPR.
Accordingly, the new criminal offence proposed by item 9 of Schedule 1 to the Bill is
compatible with Article 14 of the ICCPR.
6
New civil penalty provision and Article 14
As outlined above, Article 14 of the ICCPR provides that, in the determination of criminal
charges, everyone shall be entitled to a fair and public hearing, a presumption of innocence
and various other minimum rights in relation to criminal offences.
Including civil penalty provisions and triggering the Regulatory Powers Act could engage
criminal process rights, if the imposition of civil penalties is classified as 'criminal' under
international human rights law.
A penalty may be 'criminal' for the purposes of the ICCPR even if it is 'civil' under
Australian domestic law.
Determining whether penalties could be considered to be criminal under international human
rights law requires consideration of the classification of the penalty provisions under
Australian domestic law, the nature and purpose of the penalties, and the severity of the
penalties.
In relation to the triggering of Part 4 of the Regulatory Powers Act, the proposed civil penalty
provision at item 13 of Schedule 1 to the Bill:
• expressly classifies the penalties as a civil penalty;
• targets conduct, which will also, separately attract a criminal sanction for the same
type of conduct;
• create solely a pecuniary penalty in the form of a debt payable to the
Commonwealth; and
• does not separately impose criminal liability, and does not lead to the creation of a
criminal record.
These factors indicate that the penalties proposed to be imposed by item 13 of Schedule 1 to
the Bill is civil rather than criminal in nature. Accordingly, the criminal process rights
provided for by Article 14 of the ICCPR are not engaged by the Bill, except to the extent
outlined below.
Application of Parts 4, 5 and 7 of the RP Act and Article 14(1)
Article 14(1) of the ICCPR requires that, in the determination of criminal charges, everyone
shall be entitled to a fair and public hearing by a competent, independent and impartial
tribunal established by law. This can also apply to civil proceedings. The right is concerned
with procedural fairness, rather than with the substantive decision of the court or tribunal.
Section 82 of the Regulatory Powers Act will apply to the new civil penalty provision by
operation of existing section 64B of the Act. Civil penalty orders can only be granted by a
relevant court, which must consider all relevant matters before determining the amount of the
penalty. Existing subsection 64B(3) provides for the relevant courts for the purposes of
enforcement of the civil penalties in the Act under the Regulatory Powers Act. Accordingly,
the right to a fair hearing is engaged, but not limited by the triggering of Part 4 of the
Regulatory Powers Act.
Part 5 of the Regulatory Powers Act will apply to the new civil penalty provision by
operation of the amendment proposed to section 64C of the Act (item 28 of Schedule 1 to the
7
Bill). Section 104 of Regulatory Powers Act provides that an infringement notice is required
to state that the person may choose not to pay the penalty specified in the notice, and notify
them that, if they do so, proceedings seeking a civil penalty order may be brought against
them in a court. Accordingly, the person must always be advised of the consequences of not
paying the penalty, and of their right to have the matter dealt with by a court. As the person
may elect to have the matter heard by a court, rather than pay the penalty, the right to fair
hearing is engaged, but not limited by the operation of Part 5 of the Regulatory Powers Act.
Under Part 7 of the Regulatory Powers Act, an injunction can only be granted by a court.
Further, a court may only grant an injunction where a person has engaged, is engaging or is
proposing to engage, in conduct that contravenes a provision of the Act, or where a person
has refused or failed, or is refusing or failing, or proposing to refuse or fail, to do a thing and
that refusal or failure was, is or would be a contravention of a provision of the Act. Thus, the
right to a fair hearing is engaged, but not limited, by item 29 of Schedule 1 to the Bill which
triggers Part 7 of the Regulatory Powers Act in respect of the new civil penalty provision.
Accordingly, the amendments in Schedule 1 to the Bill are consistent with the human rights
in Article 14(1) of the ICCPR.
Conclusion
The Bill is compatible with human rights because it promotes the right to health, and to the
extent that it may limit a human right such a limitation is reasonable, necessary and
proportionate.
8
ABBREVIATIONS
The following abbreviations are used in this explanatory memorandum.
ACMA Australian Communications and Media Authority
ACMA Credit Betting Report on the Review of Part 2B of the Interactive Gambling
Report Act 2001 - Credit betting prohibitions
Act Interactive Gambling Act 2001
Bill Interactive Gambling Amendment (Credit and Other Measures)
Bill 2023
PJC Inquiry Parliamentary Joint Committee on Corporations and Financial
Services inquiry into the Regulation of the use of financial
services such as credit cards and digital wallets for online
gambling in Australia
Regulatory Powers Act Regulatory Powers (Standard Provisions) Act 2014
9
NOTES ON CLAUSES
INTERACTIVE GAMBLING AMENDMENT (CREDIT AND OTHER MEASURES)
BILL 2023
Clause 1- Short Title
Clause 1 provides for the short title for the Act. When enacted, the Bill is to be cited as the
Interactive Gambling Amendment (Credit and Other Measures) Act 2023 (the Act).
Clause 2 - Commencement
This clause provides that sections 1 to 4 will commence on the day the Act receives the Royal
Assent.
Part 1 of Schedule 1 to the Bill (which prohibits the use of credit and digital currency for
certain interactive wagering services) will commence 6 months after the Act receives the
Royal Assent. This will provide industry with additional lead time to put appropriate
arrangements in place to avoid contravening the proposed new criminal and civil offence
provisions relating to the ban on the use of credit cards, credit related products and digital
currency.
The enforcement provisions outlined in Part 2 of Schedule 1 to the Bill will commence the
day after the Act receives the Royal Assent. This means the ACMA's new powers to impose
enforceable undertakings (proposed section 64E) and remedial directions (proposed
section 64F) for breaches of other offences under the Act would commence the day after the
Act receives the Royal Assent.
The ACMA will have the same enforcement powers to enforce the new prohibition of the use
of credit for interactive wagering services 6 months after the Act receives Royal Assent. The
later timeframe will allow industry sufficient time to adjust its systems and processes to
comply with the new regulatory regime. This is consistent with the 6 month transitional
period that was provided with the introduction of the prohibition on operators providing
credit to customers in section 15C of the Act under the Interactive Gambling Amendment Act
2017.
Clause 3 - Schedules
Clause 3 is a machinery provision that provides that legislation that is specified in a Schedule
to the Act, is amended or repealed as set out in the applicable items in the Schedule, and any
other item in a Schedule has effect according to its terms. There is only one Schedule to the
Act, comprising two Parts.
Clause 4 - Review of the operation of Part 1 of Schedule 1
Given the rapid development of payment option technology, it is important to have a clear
assessment of whether new products might be used to circumvent the prohibition on the use
of credit cards for online wagering.
For this purpose, clause 4 requires the Minister to arrange for a review of the operation of
Part 1 of Schedule 1 of the Bill, by way of a public consultation, to be started 2 years after
commencement. The review is to be completed within 6 months.
10
It is envisaged that a Commonwealth agency will conduct the review required by clause 4.
The entity conducting the review must give the Minister a written report, and the Minister
will be required to arrange for a copy of the report to be tabled in both Houses of Parliament
within 15 sitting days after the report is given to the Minister.
11
SCHEDULE 1 - AMENDMENTS
PART 1--Prohibiting the use of credit
Interactive Gambling Act 2001
Item 1 - section 3
This item would amend section 3 of the Interactive Gambling Act 2001 (the Act), which
contains a simplified outline of the Act. The simplified outline is intended to assist readers to
understand the substantive provisions, and is not meant to be comprehensive.
As a consequence of the new ban on credit cards and digital currency, the new paragraph
3(cb) explains that certain interactive wagering services must not accept or offer to accept
payment using specified payment methods including credit cards and digital currency.
Item 2 - section 4
Item 2 would insert into section 4 of the Act a new definition of digital currency, being a key
term used in several of the new substantive provisions inserted by the Bill. The term is
defined as having the same meaning as provided in A New Tax System (Goods and Services
Tax) Act 1999 (GST Act). Specifically, that term is defined in the section 195-1 of the GST
Act comprehensively and means digital units of value that satisfy certain criteria, such as: the
requirement to being generally available to members of the public without any substantial
restrictions on their use as consideration and not being denominated in any country's
currency; or denominated in a currency that is not issued by an Australian government
agency or a foreign government agency.
An example of a form of digital currency that comes within the GST Act definition is
cryptocurrency.
Item 3 - section 11A
This item would amend the definition of credit at section 11A of the Act by removing the
words 'under a contract, arrangement or understanding'.
This change implements recommendation 1 of the ACMA Credit Betting Report. The ACMA
submitted that while the definition of credit in subsection 3(1) of the National Credit Code
envisages a credit contract, a credit arrangement between a wagering operator and a customer
'is most likely to be achieved informally, generally through a telephone conversation or face-
to-face meeting.'3 Item 3 is intended to avoid uncertainty in the scope of the proposed ban on
the use of credit cards and credit related products by making clearer that informal transactions
between a wagering operator and customers are captured. This change would provide
enhanced safeguards for consumers.
Item 4 - Part 2B
This item would repeal the heading, and inserts a new title: 'Part 2B--Prohibitions relating to
credit and digital currency for certain interactive wagering services'. This amendment is
3
Refer to ACMA's 2021 Report on the Review of Part 2B of the Interactive Gambling Act 2001 - Credit betting
prohibitions, page 9.
12
consequential to the amendments that introduce a new criminal offence provision and civil
penalty provisions regarding the use of credits cards, credit related products and digital
currency.
Item 5 - section 15B
This item would amend the simplified outline of Part 2B of the Act to add two summary
points: namely:
- that credit must not be provided to customers of certain interactive wagering services;
and
- that certain interactive wagering services must not accept payment using specified
methods, including credit cards and digital currency. (Item 15 would insert a new
subsection 15C(4A) that sets out the prohibited methods of payment).
The summary note specifically uses the term 'certain interactive wagering services' in
recognition of exceptions for on-course bookmakers, at existing section 15D where the
provider's annual wagering turnover is less than $30 million per annum, and existing
section 15E (where the customer is a gambling service provider). However, on-course
bookmakers would not be exempt from the new ban on the use of credit and digital currency
for interactive wagering.
While the Bill does not specify the technical mechanism that must be used to block the use of
credit cards and other digital products, it is expected wagering operators may typically use
Bank Identification Numbers (BINs), at least initially, to identify and block credit card
payments.
Blocking BINs has been successfully deployed by Australian casinos and poker machine
venues to stop credit card withdrawals from ATMs, and was used in the United Kingdom to
implement its credit card ban for online gambling in April 2020. However, wagering
providers are open to use other methods to block the use of credit for online wagering, in
consultation with their banks and relevant payment gateway operators, as other detection or
identification methods evolve.
Items 6 to 22 of Part 1 of Schedule 1 to the Bill would amend existing section 15C and set out
the provisions for the prohibitions relating to payment using credit and digital currency for
certain interactive wagering services.
Item 6 - Section 15C (heading)
This item would insert a new heading for section 15C 'Prohibitions relating to credit and
digital currency for certain interactive wagering services'. This amendment is consequential
to the amendments at items 7-18 and is intended to reflects the expanded scope of the
provision.
Item 7 - Before subsection 15C(1)
This item would insert the subheading, 'Offences' to subsection 15C(1).
13
Item 8 - Subparagraph 15C(1)(b)(ii)
This item would remove the words: '(other than by way of an independently issued credit
card)'. The effect of this amendment to subparagraph 15C(1)(b)(ii) of the Act is to explicitly
remove the existing exclusion that enabled a person to use an independently issued credit
card for online wagering. The PJC Inquiry labelled the exemption for credit cards a 'glaring
omission in the current regulatory system'.4
Item 9 - After subsection 15C(1)
This item would insert a new subsection (1A) into section 15C, and creates a new criminal
offence provision. A person commits an offence if they intentionally provide a regulated
interactive gambling service that is a wagering service and accepts or offers to accept
payment in connection with the service using a method mentioned in new subsection
15C(4A) of the Act from a customer, or a prospective customer, of the service who is
physically present in Australia.
The maximum penalty for commission of the new offence would be 500 penalty units
($156,500, based on one penalty unit value of $313).5 This level of penalty is considered
appropriate to reflect the seriousness of the contravening conduct, which creates significant
harm to vulnerable persons, who would use credit to gamble with money they do not have,
which can lead to financial distress, unemployment and relationship breakdown, and can spill
out to family members, friends and the broader community.
Also, the proposed penalty is consistent with penalties for existing offences of a similar kind
or of a similar seriousness. The high penalty amount in subsection 15C(1A) has a deterrent
effect as there is expected to be stigma of the conviction if a person were found guilty of
committing an offence against subsection 15C(1A).
The new criminal offence applies only to persons who provide a 'regulated interactive
gambling service' (within the meaning of section 8E of the Act) that is a 'wagering service'
(within the meaning of section 4 of the Act). In simple terms, it would not apply to regulated
interactive gambling services falling within paragraphs (c) - (f) of the definition of 'gambling
service' in section 4 of the Act, such as a service for the conduct of a lottery or for the
conduct of a game of mixed chance and skill. It would also not apply to face-to-face betting,
which is outside the scope of the Act.
This new offence provision has been framed to be consistent with the Guide to Framing
Commonwealth Offences.
Item 10 - Subsection 15C(2)
This item would insert the words, 'or (1A)' after 'subsection (1)', and is consequential to the
addition of new subsection 15C(1A) by item 9.
4
PJC Inquiry Report, page 34.
5
Penalty unit current as at August 2023.
14
Item 11 - Before subsection 15C(3)
This item would insert the new sub-heading 'Civil penalty provisions' before subsection
15C(3) of the Act and is consequential to the change proposed by item 12.
Item 12 - Paragraph 15C(3)(b)
Existing subsection 15C(3)(b) provides that a person commits an offence if they intentionally
provide a regulated interactive gambling service that is a wagering service; and facilitates or
promotes the provision of credit, by a third person, in connection with the service to a
customer, or prospective customer, of the service who is physically present in Australia.
There is currently a carve out for independently-issued credit card.
This item would remove the words: '(other than by way of an independently issued credit
card)' from paragraph (b). The effect of this amendment would be to remove the ability for a
person to use an independently issued credit card for interactive wagering.
Item 13 - After subsection 15C(3)
This item would insert a new civil penalty provision in subsection 15C(3A) of the Act
(enforceable under Part 6 of the Regulatory Powers Act).
The new provision provides that a person will be in contravention if they provide a regulated
interactive gambling service that is a wagering service and accepts or offers to accept
payment in connection with the service using a method mentioned in new subsection
15C(4A) (refer item 15) from a customer, or a prospective customer, of the service who is
physically present in Australia.
The maximum penalty for commission of the new civil penalty provision would be 750
penalty units ($234,750, based on one penalty unit value of $313).6 The high penalty amount
in subsection 15C(3A) is intended to have a deterrent effect and is considered appropriate.
The level of penalty is considered appropriate to the reflect the seriousness of the
contravening conduct, which creates significant harm to vulnerable persons, who would use
credit to gamble with money they do not have, which can lead to financial distress,
unemployment and relationship breakdown, and can spill out to family members, friends and
the broader community.
Also, the proposed penalty is consistent with penalties for existing offences of a similar kind
or of a similar seriousness.
This new offence provision is framed consistent with the Guide to Framing Commonwealth
Offences.
Item 14 - Subsection 15C(4)
This item would insert the words 'or (3A)' after 'subsection (3)', and is consequential to the
addition of new subsection 15C(3A) proposed by item 13.
6
Penalty unit current as at August 2023.
15
Item 15 - Methods of payment (subsection 15C(4A))
This item would add a new subsection 15C(4), which lists the methods of payment that
wagering providers would be prohibited from accepting under section 15C of the Act. These
are:
- credit cards (paragraph 15C(4A)(a));
- an account, service or facility in which payment is made from a credit card linked to
the account, service or facility (paragraph 15C(4A)(b));
- digital currency (paragraph 15C(4A)(c)); and
- a method of a kind determined by the Minister by legislative instrument for the
purposes of this paragraph (paragraph 15C(4A)(d)).
The PJC Inquiry recommended that the Government implement legislation to ban wagering
providers from accepting payment by credit cards, including via digital wallets. Generally, in
order for a person to use credit for online wagering, they need to link their credit card to an
online wagering account, or arrange for credit to be provided through a facility that deposits
money into an online wagering account.
Paragraph 15C(4A)(b) is intended to include an account, service or facility in which a
payment is made from a credit card linked to the account, service or facility. This is intended
to capture digital wallets (or e-wallets). A digital wallet is a software application or service
that allows users to store or transfer funds or to make transactions. Some digital wallets
enable users to make card-less or contact-less payments to merchants at a point-of-sale.
Others facilitate online transfers and transactions between customers and merchants.
Digital currency, such as cryptocurrency, has been included in new subsection 15C(4A)(c) to
prevent the use of possible workarounds to circumvent the proposed new ban. For example, a
person could purchase cryptocurrency using a credit card and then use those funds for
gambling. For the purpose of the Act, the term 'digital currency' has the same definition as
given to that term in the GST Act (paragraph 15C(4A)(c)), which has an expansive scope.
Paragraph 15C(4A)(d) empowers the Minister to make (disallowable) legislative instruments
to extend the ban to new types of credit products. This provision is intended to ensure that the
legislation can respond to technological changes that may be introduced to the market over
time, that may be used to circumvent the prohibition.
Any such determination would be a disallowable instrument for the purposes of section 46A
of the Acts Interpretation Act 1901 (subclause 10(3)). As such, if the power were to be
exercised by the Minister to specify different methods, such a determination would be
registered on the Federal Register of Legislation, tabled in both Houses of Parliament, and
subject to Parliamentary disallowance.
Item 16 - Before subsection 15C(5)
This item would insert a new heading titled 'Exceptions'.
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Item 17 - Subsection 15C(5)
This item would make a consequential change to add new cross references in subsection
15C(1A) and (3A). The effect is to extend the due diligence defence that currently applies to
subsections 15C(1) and (3) to the new offence provisions relating to the ban .
The effect of this would be to ensure that the due diligence defence is available in respect of
the prohibited conduct at subsections 15C(1A) and (3A) in cases where the person did not
know, and could not, with reasonable diligence, have ascertained that the customer, or
prospective customer, was physically present in Australia.
Item 18 - After subsection 15C(5)
Proposed subsection 15C(5A) would create an exception to the new offence provision under
new subsection 15C(1A) and the new civil penalty provision in proposed section 15C(3A)
where a person did not know, and could not, with reasonable diligence, have ascertained that
the customer, or prospective customer, was making a payment with a method mentioned in
subsection 15C(4A).
The note accompanying subsection 15C(5A) provides that, in a case of proceedings for an
offence against subsection 15C(1A), the defence would bear the evidential burden (i.e. the
burden of adducing or pointing to evidence that suggests a reasonable possibility that the
matter exists or does not exist) on matters in subsection 15C(5A), in line with subsection
13.3(3) of the Criminal Code (contained in the Schedule to the Criminal Code Act 1995).
This provision mirrors the due diligence exceptions that already apply in respect of the
offence under existing subsection 15C(1) and civil penalty provision under subsection
15C(3). The effect of proposed subsection 15C(5A) is that there is a reversal of the burden of
proof, and the defendant must raise evidence that their conduct fell within the exception. If
the defendant discharges this evidential burden, the prosecution must disprove the matter
beyond reasonable doubt.
Placing the evidential burden on the defendant in this case is appropriate as the evidentiary
matter required to be established--whether the defendant did not know or could not have
ascertained with reasonable diligence that the customers, or prospective customer, was
making a payment with prohibited form of credit--is a matter exclusively within the
knowledge of the defendant. In other words, the defendant is in the best position to provide
evidence as to what reasonable diligence checked that undertook and how they did not know
or could not have known that the form of payment used was a prohibited form. It would be
extremely time consuming and burdensome for the prosecution to disprove this 'knowledge'
matter than it is for the defendant to established this matter.
While it is a matter for a court to decide, it is anticipated that there will be a range of factors
relevant to establishing if the defence is made out. For example, what the wagering provider
conveyed to the customer on its website or elsewhere about what forms of payment were
allowed or not allowed, and the wagering provider's procedures and systems, including any
technical solutions, steps or other arrangements that they put in place directly or through their
merchant/ecommerce provider, to prevent the acceptance of a prohibited form of payment as
listed at proposed new subsection 15C(4).
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The Bill does not otherwise alter the process that would apply to the investigation or
prosecution of the criminal penalty as compared to other offences in the Act or under
Commonwealth law. If the defendant discharges this evidential burden, the prosecution must
disprove the matter beyond reasonable doubt. For the reasons given above, this approach is
consistent with the Guide to Framing Commonwealth Offences, Infringement Notices and
Enforcement Powers.
Item 19 - Paragraph 15C(6)(a)
This item would amend paragraph 15C(6)(a) to insert the words 'or payment by the methods
mentioned in subsection 15C(4A) from', when determining whether a customer or
prospective customer was physically present in Australia. This is a change consequential to
item 18.
Item 20 - Subsection 15C(7)
This item would remove the definition of 'independently issued credit card' in keeping with
the policy intent of banning the use of credit cards, credit related products and digital
currency for online wagering implemented by the new offence provisions under subsection
15C(1A) and 15C(3A).
Item 21 - Before subsection 15C(8)
Item 22 - At the end of subsection 15C(8)
Item 22 would update the cross references to include references to subsections 15C(1) and
(1A). The effect is to extend the operation of subsection 15C(8) to the capture the new
offence provisions. By this amendment, section 15.4 of the Criminal Code (extended
geographical jurisdiction - category D) would apply to an offence (or contravention) of
existing subsections 15C(1) or proposed new subsection 15C(1A).
Section 15.4 of the Criminal Code is an extension of the standard geographical jurisdiction
set out in section 14.1 of the Criminal Code. Section 15.4 of the Criminal Code applies the
offence provision to an offence whether or not the conduct, or a result of the conduct,
constituting the alleged offence occurs in Australia. This extension of jurisdiction is
necessary to ensure the effectiveness of the offence, because it would be possible for offshore
gambling service providers to commit the conduct constituting the offence in subsections
15C(1) or 15C(1A) wholly in a foreign country, where there may not be a corresponding
offence in force.
Item 23 - Subsection 15E(1)
Item 23 would update the section cross references at subsection 15E(1) to include references
to add new subsections 15C(1A) and (3A). The effect of this is that those provisions do not
apply if the customer, or prospective customer, of the regulated interactive gambling service
is also the provider of a gambling service. This exclusion is proposed as there is not expected
to be individual gambling harms arising from this provider to provider arrangement.
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Item 24 - Subsection 15F(1)
Item 25 - Subsection 15F(2) (Acquisition of property)
These items would repeal the transitional provision in subsection 15F(2) which are now
spent, given that section 15C has commenced.
Item 26 - Section 15G
This item would repeal the review, consultation and reporting provisions which are all now
spent.
Item 27 - After paragraph 64A(ca)
Item 28 - After paragraph 64C(1)(ca)
Item 29 - After paragraph 64D(1)(ca)
These items would make consequential amendments as a result of the creation of a new civil
penalty provision by item 13. As a result, the ACMA would be empowered to issue a formal
warning (paragraph 64A(CB)), infringement notices (paragraph 64C(1)(c)), or injunctions
(paragraph 64D(1)(cb)) if a person contravenes the civil penalty provision in
subsection 15C(3A) by accepting a credit payment from a person who is physically in
Australia. The relevant provision of the Regulatory Powers Act are applied to the new civil
penalty provision.
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PART 2 - Enforcement
Interactive Gambling Act 2001
Item 30 - Subsection 15(3) (note)
Item 31 - Subsection 15AA(5) (note)
Item 32 - Subsection 15A(3) (note)
Item 33 - Subsection 15C(5) (note)
Item 34 - Subsection 15D(1) (note)
Item 35 - Subsection 15E(1) (note)
These items would update the language of each accompanying note relating to the evidential
burden in proceedings for criminal offence or civil penalty provisions in the Act for enhanced
clarity.
Item 36 - Civil penalty provisions - enforceable undertakings
Section 64E - Civil penalty provisions - enforceable undertakings
Item 36 would insert three new sections into the Act (sections 64E, 64F and 64G).
Proposed new subsection 64E(1) would provide each civil penalty provision of the Act is
enforceable under Part 6 of the Regulatory Powers Act. That part creates a framework for
accepting and enforcing undertakings relating to compliance with provisions. An enforceable
undertaking is a legally binding commitment given voluntarily by a person or entity to the
regulator to act or refrain from acting in a particular manner, as a way of addressing the
regulator's concerns about a particular contravention of a civil penalty provision.
This change will mean that the ACMA (as the regulator of the Act) can receive enforceable
undertakings for breach of any civil penalty provisions under the Act including the new credit
card provisions in section 15C.
Proposed subsection 64E(2) would provide that for the purposes of Part 6 of the Regulatory
Powers Act, the ACMA is an authorised person in relation to the civil penalty provisions of
the Act.
Proposed subsection 64E(2) would specify the relevant courts in relation to the civil penalty
provisions under the Act: the Federal Court; the Federal Circuit and Family Court of
Australia (Division 2).
The ACMA may, at its discretion, publish an undertaking (subsection 64E(4)). The
administrative powers extend to Australia's external territories when used in the geographical
sense (as defined in section 4 of the Act).
The scope of an enforceable undertaking would depend on the circumstances, but could
involve such things as the appointment of an independent consultant or auditor to review a
provider's systems, processes and procedures (including training procedures) and provide a
report with recommendations for improvement.
Part 6 of the Regulatory Powers Act is expressed to have extended territorial application
(refer new subsection 64E(5)).
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Section 64F - Civil penalty provisions - remedial directions
New subsection section 64F(1) would allow the ACMA to provide specific written directions
to a person to ensure that a wagering provider does not contravene a civil penalty provision,
or is unlikely to contravene the provision, in the future.
In plain terms, remedial directions are a useful mechanism to rectify a statutory breach that
the ACMA reasonably believes has occurred or is occurring, and provide extra assurance
around ongoing compliance.
New subsection 64F(1) is an application provision and means that remedial directions are
only available where ACMA reasonably believes that a person has contravened, or is
contravening, a civil penalty provision of this Act (other than subsection 64F(4)).
Subsection 64F(3) provides that a person that is subject to a remedial direction under
subsection 64F(2) commits an offence if they contravene the direction (50 penalty units,
representing $15,650, based on one penalty unit value of $313).7 The penalty of 50 penalty
units is comparatively low when compared to penalties imposed for the substantive offences.
New subsection 64F(4) create a new civil penalty provision for contravening a remedial
direction (75 penalty units applies, representing $23,475, based on one penalty unit value of
$313).8
Section 64G - Continuing contraventions
Under new subsection 64G(1), a person subject to a remedial direction issued by the ACMA
under new subsection 64F(3), and who contravenes that direction, will be committing a
separate offence and a continuing offence for each day during which the contravention
continues, including the day of conviction for the offence or any later day.
The maximum penalty for each day is 10% of the maximum penalty that could be imposed in
respect of the principal offence (new subsection 64G(2)).
Under new subsection 64G(3), a person who contravenes new subsection 64F(4) will be
engaging in a separate and continuing contravention of that subsection in respect of each day
during which the contravention continues. The maximum penalty for each day is 10% of the
maximum penalty that could be imposed in respect of the principal offence (new subsection
64F(4)). This is percentage level is set at a level to have a deterrent effect and reduce
continuing contraventions.
This continuing offence has been clearly expressed so that the impacted person is aware that
a continued failure to comply will lead to further offences being committed.
7
Penalty unit current as at August 2023.
8
ibid
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