This month in iGaming: November 2021

Uruguay and Malaysia are bringing back online betting, Tanzania is moving to protect players and encourage market growth, and Germany’s rollout looks less and less promising. 

Uruguay, Malaysia planning to open up

Uruguay has changed its tune when it comes to online gambling. 

The country’s government adopted a ban on online casino and poker games in 2017; sports betting was only allowed when offered by the national lottery, La Banca de Quinielas. 

But this month, the Uruguayan Ministry of Finance proposed a bill that would legalize online gambling activities conducted either by the state or by private companies that already have concessions or licenses for land-based operations. 

Legislators might be inspired by the wave of liberalization sweeping the rest of Latin America and the tax revenues enjoyed by nations like Colombia. They also might have developed a new sense of pragmatism; included in the bill was a concession that online gambling is an “unavoidable reality”.

But this month’s bigger surprise is further east. 

The government of Malaysia is examining a proposal to legalize online casino gaming, a year and a half after announcing it would consider loosening rules for non-Muslim citizens. Muslims, who account for over 60% of the population, are prohibited from gambling — and the country has only one licensed land-based casino area, Resorts World Genting in the Genting Highlands. 

The 1953 law that prohibits gambling only applies to games taking place in a common gaming house. Under the current text of the law, players cannot be prosecuted for playing online and the government is also unable to issue licenses for online operations. This, as always, deprives the government of tax revenues as players visit offshore sites and funds flow out of the country. An amendment would enable the government to issue licenses and tax revenues. 

While major changes can happen slowly in the east, it’s worth it to keep an eye on any new developing market. 

Tanzania’s new ad restrictions

Just a few months after the Gaming Board of Tanzania introduced detailed online gambling regulations for the first time, the regulator has proposed a series of advertising restrictions meant to protect vulnerable populations. 

From 6:00 to 21:00, gambling advertisements won’t be allowed on television or the radio, with an exception for dedicated sports channels and advertisements for responsible gambling. Unsolicited phone calls and SMS messages will be prohibited, and any advertisements that are shown to the public will have to feature responsible gambling messages. 

The detailed regulations, released in August, are similar to the comprehensive frameworks found in European markets. 

In addition to thorough KYC measures, the regulations include requirements for operators, who must have information about themselves as well as responsible gambling messages visible on their site. The site must also display players’ account balances at all times, and full-screen mode must include a clock and a way for players to exit the game. 

The advertising code is aimed at promoting a healthy industry so that the government can collect tax revenues from the fast-growing sector. Compared to the recent tug-of-war between regulators and operators in Kenya, Tanzania’s approach displays clear vision and common sense. In Kenya’s case, exorbitant tax rates drove some operators to exit the market entirely, with some still in limbo as to whether or not they will return. Tanzania, on the other hand, seems to be planning on a safe, stable, and profitable market. 

Another disappointment in Germany

But while sufficient regulations foster growth and protect players, is there a tipping point where overzealous regulators throw a wet blanket over the market?

In the eyes of many, the long-awaited rollout of legal online gambling in Germany is looking more and more disappointing. With very low bet limits, mandatory cooling-off periods when switching from sports betting to casino gaming, and high taxes, one of Europe’s biggest regulated markets could ultimately lack appeal for operators.

The state-by-state licensing system, as well, could set up more hurdles than operators will be willing to jump. On top of that, the state of Thuringia announced this month it would be joining Saxony, Brandenburg, and Bavaria in establishing a state monopoly instead of issuing licenses. 

And while some states allow private operators and others are opting for a monopoly, a handful of states are simply waiting to make a decision until the federal regulator is in place — in early 2023. 

Germany’s attempt to offer players regulated alternatives to the black market seems either disingenuous or poorly thought out. Given the mix of private licensees, public monopolies, and states preferring to simply sit tight, it’s hard to imagine operators successfully moving into the market — or even wanting to.

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