May 3, 2025

TAB will not Get Special Treatment from NZ Gambling Commission Despite Lobbying Attempts

Despite persistent lobbying efforts, the New Zealand Government has made it clear that the Totalisator Agency Board (TAB) will not receive any special treatment in any regulatory decisions. In recent developments, the betting agency has received a massive blow after the government turned down its proposal to secure an online casino licence with a $150 million offer. TAB, which is the country’s sole sports and racing betting agency, wrote to the ministers in December 2023, requesting a regulatory change. The betting agency argued that its viability was under threat if the NZ Gambling Commission continued to lock it out of the online casino market.

TAB NZ’s Ambitious Bid for Online Casino Licensing

In a move to regulate online gambling, the New Zealand Government is planning to auction off up to 15 online casino licences in 2026. According to a statement released by Internal Affairs Minister Brooke Van Velden, the move would maximize the economic benefit of the industry while also protecting the consumers. However, local operators, such as TAB NZ, didn’t take the move lightly. They expressed their fears of ending up in the hands of foreign operators who would take a significant percentage of their market share.

TAB NZ, which is barred from offering online casino products, wrote to ministers, arguing that its viability was under threat if the government continued to block it from offering online casino products. According to documents seen by a local media outlet, RNZ, TAB told the Internal Affairs Minister that it could offer a payment of $150 million to the New Zealand government for an online casino licence.

While defending the proposal, TAB argued that the deal would meet the government’s fiscal ambitions. “It is possible to get a substantial capital payment to the government from selling the rights to iGaming in an exclusive market. We estimate that there is a $150 million capital payment available for an exclusive market where there are one or two providers,” the TAB said.

“The deal would “meet the government’s fiscal ambitions. The operator could pay approximately $150m upfront for the right to operate the business under a 10-year licence,”

TAB told van Velden.

While TAB NZ didn’t disclose how it would raise the $150 million payment, it’s believed TAB could have paid directly or through a partnership with an international operator.

Government’s Firm Stance Against the Proposal

TAB is a statutory entity that is barred from offering online casino games under the current laws. When asked if she would allow TAB to obtain a licence, Internal Affairs Minister Van Velden responded by saying, “Not under my watch.”

Velden further noted that the government should focus on offering core services that Kiwis need in their lives. “I don’t believe that the government should be involved in casino gambling,” she said. “I look at the government trying to address the core services that people need in their lives, and providing an online service for casino games is not what I think the government should be involved in.”

Racing Minister Winston Peters also confirmed having received communication on the matter. However, he responded in a statement that he would never change the law to allow TAB NZ to offer online casino gambling. “Casino products are fundamentally different from wagering products, and the Minister has advised TAB NZ of his expectation that it retains its focus on sports and racing,” Peters said in a statement.

Implications for New Zealand’s Gambling Industry

The New Zealand government’s decision to deny TAB NZ an online casino gambling licence has significant implications for the country’s gambling industry. It underscores the government’s commitment to preventing state participation in online casino gaming. Listed below are some of the implications for the industry:

Market Diversification: While the government has denied TAB NZ an online casino licence, it’s planning to issue up to 15 casino licences in 2026. This not only prevents monopolistic control by TAB NZ but also leads to better services and innovations for consumers.
Regulatory Focus: The decision to deny TAB a casino licence reflects the government’s approach to regulating online gambling. It also emphasizes the need for private operators to operate within a regulated framework.
Future of TAB NZ: With the recent developments, TAB may need to review its business strategies, especially with its international partner Entain. TAB is staring at challenges such as increased competition and offshore operator dominance. But with Entain onboard, TAB can leverage Entain’s technological expertise and operational experience to improve its NZ’s offerings.

The government’s decision to deny TAB NZ a casino license also has implications for other local operators. The most notable ones include:

Offshore Operator Dominance: The New Zealand government is already planning to issue 15 online casino licenses to both local and offshore companies. This new development has raised concerns among local operators about market dominance by international firms. With advanced technology and operational experience, international operators will heighten the competition in the New Zealand gambling industry.
Financial and Regulatory Pressures: The new regulations are likely to add financial and compliance burdens to local operators. While the new regulations aim to create a safe gambling environment, they may strain the resources of local operators.
Licensing Challenges: Local operators have already started raising questions about the number of licences issued and the bidding process. Most operators want them to be reduced and restricted to operators with a domestic presence.

Public and Industry Reactions

The New Zealand government’s decision to deny TAB NZ an online casino licence has elicited mixed reactions from various stakeholders, including the general public and gambling industry experts. Here are some of the most notable reactions:

Government’s Stance: The government, through Internal Affairs Minister Brooke van Velden, said that it strongly opposes the proposal. “I don’t believe that the government should be involved in casino gambling.” The government should focus on core public services rather than expanding into online casino operations,” Velden stated. The Racing Minister Winston Peters also reacted by saying he wouldn’t change the law to offer TAB NZ a casino license. “Casino products are fundamentally different from wagering products, and the Minister has advised TAB NZ of his expectation that it retains its focus on sports and racing,” Peters said.
TAB’s Position: The betting agency expressed its disappointment, highlighting concerns about its viability. TAB said that without the online casino market, it may not be able to sustain its operations, especially in the support for sports and racing sectors.
Local Operators: Some local operators, such as SkyCity, voiced their concerns about the number of licences issued and the bidding process. They said licences should be reduced and be issued to operators with a local presence.
Māori Community’s Take: The Online Safety Iwi Leaders rejected the proposal, arguing that there were no consultations with communities likely to be affected by the new gambling reforms. They called for the New Zealand government to halt the plans, saying there was a need for community leaders to have their say. The chair of Pou Tangata Rāhui Papa said the reforms were “gambling by stealth.” “We think this will create another set of dependents. People will be able to sit in their homes and have a casino in their hands and in their pockets. It will ultimately affect the way of life for some of our families. In our view, the lack of research into the harmful effects, the flow-on effects – the physical, the financial and the psychological that will happen to families. Not just Māori families but to families in Aoteroa, “Papa stated.
Industry Observers: Industry observers have expressed their concerns about the auction of 15 online casino licences. They say there are too many licences and they may lead to dominance by large international companies. They also argue that this will not only marginalise local operators but also redirect profits overseas.

The government’s decision to reject TAB NZ’s lucrative deal shows a balancing act between public concerns about gambling harm and the nation’s desire for market diversification. While certain communities call for strict regulations, some industry stakeholders see opportunities for growth. Other industry observers say the decision is ill-advised and will only marginalise local operators while redirecting profits overseas. The New Zealand government navigates these complex dynamics cautiously, balancing the public welfare with the country’s economic implications.

Future Outlook for Online Gambling in New Zealand

The decision to action 15 licences to local and international companies showcases the government’s commitment to move away from a monopoly model. We expect to see new gambling giants, each armed with innovative technology and deep pockets. While this will improve user experiences, it will increase pressure on local operators such as TAB NZ.

A shift in regulatory focus is also likely to be witnessed in the New Zealand gambling industry. The government’s refusal to grant TAB NZ a casino licence showcases the desire to separate gambling operations from state involvement. It points to a better future, where the government acts as a regulator and not a participant. That way, the government will prioritize consumer protection over revenue generation.

In response to the current developments, TAB NZ and other local operators need to rethink their strategies in order to stay competitive. They need to seek strategic alliances with international companies that have deep pockets. TAB NZ already has a 25-year agreement with Entain, a global betting company with vast experience in gambling. We expect other local operators to follow suit by forming alliances with international operators.

Diversification of product offerings is another strategic move that can give local operators an edge. For example, TAB NZ can expand markets and bet types in both racing and sports betting. It can also add fantasy sports and e-sports to broaden its NZ offerings.