Online gambling comes in two major forms, i.e. wagering and gaming. Online Wagering involves online betting on thorough-bred, grey-hound and harness racing; sports-betting and betting on the outcome of other events (for instance an election) while online gaming includes Casino games such as black-jack, the many forms of poker and use of virtual online gaming machines. If lotteries, bingo, poker and Keno are operated through an online platform, they are also considered part of online gambling.
Today, online gambling is illegal in several countries, with some of them citing human morals and religion (like in the case of Muslim nations) as others cite addiction and a possibility of it being used to launder money, for instance that acquired via illegal sale of banned drugs.
Let us take a closer look at different countries where online gambling is prohibited and the reasons for their kinds of restrictions and prohibitions below:
The Interactive Gambling Act of 2001 forbids businesses from offering online gambling services for Australians but does not prohibit them from utilizing other online gambling services. The Act does not also prevent companies based in Australia from offering online gambling services to players based in other countries. Under the Act, online wagering and lotteries are permitted; but instantaneous, highly-repetitive or frequently-drawn lotteries are banned. Also explicitly prohibited by this act include: interactive gambling services that are Australia-based cannot be offered to gamblers in a designated list of countries; advertisements of interactive gambling services; casino games like black-jack and poker; designated versions of some electronic gaming machines; and bingo.
At least 45 percent of the Brazilian population is covered by the Internet. Being also the most populous country in Latin America and an upcoming economic giant, the nation attracts a myriad of Internet gambling operators, and the Brazilian Federal Authorities know this. Only a few forms of recreation e.g. bingo, beano and horse betting are allowed, with the Brazilian government remaining a very strong opponent of gambling on the Internet. However, this has largely been unsuccessful because most online gambling Casinos will gladly welcome customers from Brazil – and they are quite a big number – because regulation and control of these activities is very fluid at both federal and regional government levels.
Due to the fact that the Cayman Islands are a major tourist destination as well as a tax haven for businesses, one would expect that the islands would be a ripe destination for gamblers as well. But in fact the exact opposite is the case! Current laws prohibit any form of gambling whatsoever – online included – on the Cayman Islands, though penalties for gambling are relatively lax, with most offenses attracting a maximum fine of USD 10 while others receive a sentence of up to 2-months imprisonment. Running an illegal gambling business is fined up to USD 400, while the Proceeds-of-Crime law is sometimes used to fine illegal gambling operators up to USD 5,000 or a 2-year prison sentence.
All kinds of gambling, online included, are illegal under Chinese Law save for a sanctioned state-run lottery. Other exceptions – with legal gambling regimes – include the special administrative areas of Macau and Hong Kong whose legal systems are similar to their recent European administrator nations, Portugal and the UK. But illegal gambling remains common in China, with an industry that is estimated to be worth almost USD 4 billion per year. The major forms of this illegal trade include clandestine casinos, unofficial lotteries and game betting in mahjong and card games.
The Federal Republic of Germany’s Interstate Treaty on gaming came into effect on 1st January, 2008 banning all types of online gaming and betting in Germany, except for wagering on horse racing. This resulted in the European Gaming and Betting Association sending an official request to the European Commission to consider taking action against Germany because of this legislation. They argued that the supposedly stringent gambling legislation was a violation of European Union rules.
In 2010, Europe’s Court of Justice ruled that Germany’s monopolized gambling industry had to be liberalized as much as possible, and ordered the German Federal government to take steps to ensure this is done in earnest. As of 2012, Schleswig-Holstein was the only state in Germany to have already come up with its own gambling laws that allowed online gambling, with Casino operators being able to apply for a license to operate online gambling businesses.
While Indian Federal Law is largely silent on online gambling, the service is explicitly banned in the Indian state of Maharashtra under its Bombay Wager Act. Other states have no laws to ban, control or even regulate online gambling and gaming. Just a few years ago in 2012, the Justice Minister of Utar Pradesh insinuated that his state has other pressing matters to deal with when asked by a certain reporter about legislating on online gambling. The most recent bill to address gambling over the Internet was the Federal IT Rules which outlined how such illegal activities can be blocked by individual Internet service providers in India.
Israel’s gambling law enacted in 1977 – the Israeli Penal Law 5737-1977 – has no specific reference to gambling over the Internet, it only prohibits land-based gambling and playing of games of chance with the only exception being the Israeli Lottery and the Commission for Sports Gambling services. December 2005 saw the Israeli Attorney General order all over-the-Internet gambling operations that had started taking root then – including online backgammon – to close shop. He extended his order to credit-card companies by commanding them to cease any co-operations whatsoever with Internet gambling websites.
In a subsequent ruling in May 2007, the office of the Attorney General excluded Play65, an online backgammon website, from the December 2005 ruling, arguing that they represented unique circumstances on their site’s gambling activities that were not in contravention of the law or the moral code in Israel. This allowed Play65 to go back to full activity in the country.
Chapter 23 of the Japanese Criminal Code prohibits all types of gambling – including gambling online – except for betting on certain motor sports and horse racing. Some traditional cultural practices that are typical to Japan, like pachinko, can also be considered as forms of betting. Pachinko is a pinball-like slot-machine game which is formally not considered as gambling because of historical, cultural and monetary reasons. Public sports or koei kyogi – which include bicycle, asphalt-speedway motorcycle and power-boat racing – lottery (takarakuji) and toto football pools are also organized under special laws so as to raise the revenues of local and national governments in addition to offering entertainment for many and gambling is allowed on these.
The government of Russia enacted legislation in December 2006 that prohibited all forms of online gambling as well as any type of gambling that relies on telecommunications technologies. Just recently – in May 2014 – following a request from the Russian prosecutor’s office, authorities updated Russia’s Internet blacklist, adding a new list of nearly 600 websites in an effort that is seen as a first step in a major crackdown on online gambling.
Being a Muslim country, the Kingdom of Saudi Arabia prohibits all forms of gambling (including online) within its borders. The Qur’an, Islam’s holy book, refers to gambling as the 14th Greater Sin: an abomination which is the doing of the Devil. It adds that wagering on games that depend on chance makes people believe in luck rather than Allah. Muslims also believe that each human being’s fate is pre-determined and therefore not a subject of chance. They consider the act of betting on random events as a direct contravention of Islamic doctrine. But this has not prevented people, especially the young, from conducting illegal online gambling operations.
Currently, online gambling is illegal in South Africa but this does not directly apply to gambling players, because the law restricts any establishment that wants to open and operate an online gambling premise from operating within the South African territory. So, this subsequently means that a South African gambler can legally gamble within the borders of South Africa but by playing online through a Casino operated off-shore or from other countries. Online gambling became illegal with South Africa’s National Gambling Act of 2004.
This Act allowed players to visit land-based Casinos for all types of betting and gambling with the only online gambling allowed being sports betting. But it is also quite interesting that due to much dispute caused by the 2004 Act, another one was formulated and passed in 2008 to legalize online gambling, although it has NEVER come into effect – for a whopping six years – because people against it also became so many! With all these legal confusions in place, Internet gambling is still considered very illegal; no operator currently offers those services to players by operating from inside South Africa.
In September 2007, the UK Gambling Act was passed. It primarily targets online gambling operators rather than players because players, including UK residents, can legally gamble online. However, only Casinos that are based in recognized UK jurisdictions – for example Malta, Gibraltar, the Isle of Man and Alderney – can advertise to the UK market. Other jurisdictions such as Antigua and Kahnawake have currently applied for a similar status.
Online gambling is still illegal in most areas inside the United States, but this does not hinder the country from being a prolific provider of online Casino players, in fact the most prolific! An old 1961 law – The Wire Act – which prohibits inter-state telephone betting theoretically applies to the Internet, but only around a fifth of US online gamblers thought online gambling is illegal as revealed by a 2006 survey conducted by the AGA (American Gaming Association). The federal government also seems not to have been keen on enforcing this Act for Internet betting. There are indications that it has let individual states to make decisions of their own about online gambling rather than having a federal enforcement. US states that have explicitly outlawed online gambling so far include Washington, Indiana, Oregon, Louisiana, Wisconsin, Nevada, South Dakota and Illinois.
Owing to the reluctance to control over-the-Internet gambling by the federal authorities, the US senate has recently passed the Unlawful Internet-Gambling Enforcement Act or UIGEA which had a major impact on US gamblers. Not only have several of the safer Casinos ceased accepting punters form the USA but also banks and online-funding options have rapidly been drying up causing jitters in the international Internet gambling market. The UIGEA Act was designed to limit banks and eWallets that act as payment providers and fund online gambling. Whether this move is viable in the long term, or if the law can even be enforced to this effect, remains to be seen. However, several online Casinos have ceased operations with US players as a precaution.
Is it rather obvious that one should expect gambling to be illegal in Vatican City? Being the home of the Roman Catholic faith, this tiny nation of about 1000 people does not allow any form of gambling, online or any other. With this small population – all of them bent on religion and nothing else – expect to see no form of legal gambling in the near future, or even ever!