Review on gambling in New Zealand - industry statistics and law changes

At the moment, the gambling in New Zealand is fully legalised. There are several authorised gambling activities like casinos, horse racing, slot machines and lotteries. Gambling on the island started with the horserace in the 19th century.

Online casinos are prohibited in New Zealand, but the residents of this country can use services of foreign operators. As a consequence, virtual slot machines are also a taboo, unlike their terrestrial counterparts. Despite this, there is an opportunity to become a user of video slots online if websites containing them are not blocked by the provider. This can happen if the provider thinks slot machines may contain gambling features. In this case, the reason for the ban may be not announced.

Gambling in New Zealand

Gambling in New Zealand has always been allowed to a certain extent. The locals place bets on horse races and boxing matches since 19th century.

As for 2016, there are 6 casinos and more than 1,300 gambling platforms operating in New Zealand. The number of slot machines is more than 16 thousand.

Brief description of New Zealand

New Zealand is an island nation in the Pacific Ocean. Its population is 4.5 million people. The country is adjacent to the Australia, New Caledonia, Fiji and Tonga. New Zealand has a unique wildlife.

The largest cities are Auckland (1,294,000 inhabitants) and Wellington (379,000 inhabitants). Zealand is divided into 13 city councils. The population is mainly the descendants of the British, the Dutch, the Germans, the “white” South Africans. The indigenous Maori population is 14.6%.

The country's economy is based on agriculture, manufacturing and food industries, as well as on tourism. According to the size of the GNP (gross national product), New Zealand takes 60th place in the world. It is also recognised as one of the best countries for business.

The history of gambling in New Zealand

Gambling in New Zealand has existed since the migrants from the UK began to explore the territory. Gambling was a common pastime in the period of colonisation.

The Gambling Act 1908 has banned gambling business – only horse racing remained legal. It was the only legitimate form of gambling until 1951 when TAB appeared – state bookmaker.

Then the laws softened and new forms of gambling became available to New Zealanders. Sequentially, lottery, slot machines, casinos and online casino appeared.

Horserace

This is the oldest form of gambling in New Zealand. The first race was performed in 1835. However, betting on horses was banned in 1920. They were allowed again only in 1961, though with great limitations.

Lottery

The first lotteries appeared in 1933. They were relatively small. The large one Golden Kiwi Lottery appeared in 1961. Then it was replaced by Lotto in 1987.

Slot machines

Slot machines were first introduced in New Zealand in 1991. Slang name – poker machine or NZ pokies in pubs, as well as in Australia. The government allowed to organise clubs with slot machines in 1989.

In the 90s, operators preferred to place slot machines in Wellington and around it as it is a metropolitan area. Then the government announced that it would liberate the capital of gambling in 2001. Seven city casinos were closed because the authorities were afraid of a gambling addiction in New Zealand development.

Casinos

The first casino was opened in the city of Christchurch in 1994. Then there were casinos in other cities built:

• Dunedin;
• Hamilton;
• Queenstown;
• Auckland.

Casinos operate in these cities so far.

Online slot machines

As a rather gambling nation, New Zealanders, of course, could not miss online casinos. Online gambling in New Zealand began with the first websites and platforms in 1994. Microgaming was the first supplier of online slots in New Zealand.

Fruit Fiesta and Cash Splash – these are one of the first online pokies NZ that became available for New Zealanders. In the late 90ties, the New Zealanders familiarised with slots from Playtech and Cryptologic.

First online slots had only one payline and three reels. Then, with the development of computers, companies began to introduce more paylines, wild symbols, scatters, bonuses and bonus games.

New Zealand legislation in the gambling business

Gambling laws in New Zealand are:

1. Boxing and Wrestling Act 1981;
2. Gambling Act 2003;
3. Racing Act 2003;
4. amendments to the law in 2003 – Gambling Amendment Act, adopted in 2005 and 2015.

Gambling Act 2003 – this is the basic law of gambling in New Zealand. It defines the classes of games of chance depending on the cash cost and risk for society. Also, the Act defines private gambling.

Classes of gambling games

New Zealand defines 4 classes of gambling depending on stakes and payments.

First class:

• the organiser of the game is not paid any fees and compensations;
• gambling activities comply with the rules of the game;
• no gambling machines engaged in the process;
• prizes or potential revenue of a casino in one session does not exceed USD 500;
• if the game is organised by citizens individually, the entire profit will be spent on prizes;
• if the game is organised by a company, the entire profit will go the needs of society;
• the game does not require a license.

Second class:

1. prizes for one session do not exceed USD 5000;
2. potential revenue does not exceed USD 25,000 per session;
3. the game of this class can be organised only by society;
4. profit should be directed to the needs of society;
5. consumer information should be clearly set out in the game: the name of a company, the goals, the number of tickets, the closing date, prizes, etc.;
6. the game does not require a license.

Third class:

• offered or received prizes for the game or for a single session exceed USD 5000;
• usual forms of the game – a massive lottery, bingo, instant games and other forms (e.g., “casino nights”);
• can be organised only by civil society or corporate society;
• no gambling machines can be used;
• officials of the Department of Internal Affairs must make sure that activities are financially profitable, costs are minimised, and the maximal benefit is returned to society;
• the goal should be authoritative;
• a game is subject to licensing.

Fourth grade:

1. any game that includes the use of gambling machines outside casinos;
2. can be organised only by corporate societies;
3. only for authoritative purposes.

Private gambling:

• it is a game that is played in a private residence;
• all bets are returned in the form of prizes to the winners;
• Primarily, it is a social event or entertainment;
• the organisers are not being paid any fees and remuneration;
• people who do not live in the residence cannot participate in the game;
• all participants have an equal chance of winning and only they can win.

Advertisement of gambling in New Zealand

Gambling advertising in New Zealand of overseas portals is prohibited under the Gambling Act 2003. The violator of this law can be forced to pay a fine up to $ 10,000.

Regulators of gambling business in New Zealand

Several government agencies are engaged in gambling businesses issues in New Zealand.

The Department of Internal Affairs is responsible for:

1. legal framework of gambling;
2. licensing of gambling venues (except casinos);
3. provision of information and training of the public.

The Ministry of Health is responsible for:

• coordination and financing services for gambling addiction in New Zealand;
• develops and carries out plans to prevent and minimise the harm from gambling.

Gambling Commission is responsible for:

1. licensing casino operators;
2. coordination of agreements between casino operators and holders of licenses for gambling sites;
3. complaints and disputes in the field of casinos;
4. assistance in determining payments for treatment of excessive gambling;
5. refines licensing conditions for casino operators.

Racing Board and New Zealand Thoroughbred Racing deal with horse racing.

New Zealand Lotteries Commission monitors lotteries.

Taxation of gambling in New Zealand

Gambling taxes in New Zealand are allocated for the payment of the following taxes:

• government tax – 20%;
• tax on goods and services – 13.4%;
• contributions to the treatment of gambling addiction – 1.30%;
• costs of Internal Affairs Department – 2.2%;
• depreciation and amortisation – 9.27%;
• repair and maintenance – 2.6%;
• costs of gambling portal – 12.8%;
• payment for the society – 2.26%;
• donations – 36.53%.

Thus, government contributions amount to more than USD 250 million annually.

Today’s gambling in New Zealand

As of 2016, there are 6 casinos and more than 1,400 gambling portals operating in New Zealand. The number of slot machines is more than 16 thousand.

Horserace

Gambling statistics NZ says, that today, there are 52 racetracks operating in the country, where more than 3000 races are held annually. The prize fund of more than USD 50 million. The monopoly on the organisation of the race is held by Totalisator Agency Board (TAB) or the New Zealand Racing Board since 1951.

A certain percentage of every bet is held and then invested in the industry development. New Zealand Racing Board directed USD 140 million on the development of clubs and infrastructure in fiscal 2015.

Lotteries

Lotteries are quite popular in New Zealand today. The biggest one is the state lottery Lotto. Players can choose different forms of games such as Powerball and Big Wednesday.

Lottery Grants Board invested about USD 200 million of the money spent by players into the development of sport, culture, health.

Slot machines

Slot machines outside casinos are managed by charitable associations. Usually, they are located in pubs, hotels and clubs.

The largest number of slot machines in New Zealand was observed in June 2003 – 25,221 devices. Since then, the number of slots reduces gradually. Now the country has 16,814 slot machines on more than 1,300 portals. Note, that this figure does not take into account slot machines in casinos. Casinos – it’s a separate matter.

Slot machines belong to the fourth class of gambling (see section “Classes of gambling”). Administrative divisions are quite dependent on the revenue from slot machines and gambling in general.

By the way, this is why most of New Zealanders see gambling as a positive phenomenon – an opportunity to raise more money for a district or the entire state. See section “Demographic data on gambling in New Zealand”.

Features of slot machines in New Zealand

Since 2009, all slot machines are certainly provided with the information button that shows how much money and time the player has spent on the device. It motivates people to play responsibly and to take breaks after long gambling sessions.

Also, all slot machines are equipped with EMS – Electronic Monitoring System. It monitors data of all gaming machines in the country. The information is sent to the central monitoring server, which creates gambling in New Zealand statistics: how much money is spent on a particular slot machine, how much it has given to the player, what is the income from it, etc.

The RTP percentage of a slot located outside a casino should be 78-92%. Theses limit issues are under the care of government regulators.

Areas with the highest density of slot machines per capita:

1. Kaikoura;
2. Thames-Coromandel;
3. Mackenzie District;
4. Waitomo;
5. Grey District;
6. South Wairarapa;
7. Buller.

Casinos

Today, there are 6 licensed New Zealand casinos. All casinos are controlled by the government. They are located in the following cities:

• Christchurch;
• Dunedin;
• Hamilton;
• Queenstown;
• Auckland.

The largest group of casinos is called Skycity. The four major casinos belong to it: two in Queenstown, one in Auckland and one in Hamilton. Two casinos in Dunedin and Christchurch are carried out by private operators. Activities of all casinos are strictly regulated and limited by law.

For example, in May 2013, a casino in Auckland received permission to expand (230 additional slots and 40 gaming tables) only after the institution has invested USD 402 million in the construction of the city Convention Centre.

Online gambling in New Zealand

Answering the question is online gambling legal in New Zealand we should begin with the fact that New Zealand does not allow organising online casinos in the country. Players can legitimately play in international casinos which servers are located abroad. Besides, their winnings are exempted from income tax.

Both offline and online players prefer to play slots, lotteries and sports betting. Most make bets on rugby, cricket, soccer and netball.

The list of best casino in New Zealand:

1. Casino Mate;
2. Royal Vegas Online Casino;
3. JackpotCity;
4. Casino.com.

The most popular online slot machines among New Zealanders:

• Game of Thrones;
• Big Chef;
• Bar Bar Black Sheep;
• Fish Party;
• Ariana;
• Ninja Magic.

Revenues from gambling in New Zealand

Gambling in New Zealand an economic overview says that players spent USD 2 billion in the fiscal 2014-2015 year. New Zealand does not keep statistics on income but on the amount of money spent by players. This equates to earnings of gambling institutions.

Below, there is the official statistics for the 2014-2015 fiscal year.

Players spent USD 1.47 billion in total. This amount includes:

1. betting on horse races (TAB) – players spent USD 229 million;
2. lottery – USD 295 million;
3. slot machines outside casinos – 576 million;
4. casinos – 371 million.

Demographic data on gambling in New Zealand

According to Gambling and Addictions Research Centre studies, the majority of New Zealanders – 85% – prefer to organise games as a way to raise money for worthy causes. Also, most believe gambling is a business or a legal way to increase the income of the state.

Only one-third of citizens is dissatisfied with the gambling revenue is distributed – either out of ignorance, either by personal convictions against gambling itself.

Popular games

41% of New Zealanders play more than once a week. Gambling in New Zealand age is 18 or more. Only 10% of the players over 18 years play every week. They are mostly represented by male players aged 55-64 years and the Maori. The average player spends USD 41 a month. Men spend more than women. Only 10% of adults are at risk.

30% of the players play the lottery. Favourite Lottery – Lotto – most of the residents play it with such frequency.

There are also popular:

• betting on horses or greyhounds;
• Instant Kiwi game;
• Telebingo game.

Half of the respondents are satisfied with the number of locations where you can gamble. About 41% thinks that there are too many gambling venues. It is noteworthy, that most of the people unsatisfied with this surplus are those persons who have a gambling addiction.

Electronic slot machines and online gambling in casinos abroad is considered the most undesirable form of gambling.

Problems with gambling addiction

Compared with other countries, New Zealand has a low percentage of players with a problem gambling in New Zealand. A brief summary shows that the percentage interestingly correlates with the number of slots:

1. 1991 – the number of slot machines is 6 273 – the percentage of players with the addiction is 1.2% of the total population;
2. 2000 – the number of slot machines is 12 201 – players with gambling issues were 0.5%.

That is, as the number of slot machines grows, the problem gambling figures decrease. But then, during 2007-2016, the correlation is not observed: the number of compulsive gamblers does not depend on the number of slot machines in the country.