Speaker 1: Kyota.
Speaker 2: I'm Chelsea Daniels and this is the Front Page, a
Speaker 2: daily podcast presented by the New Zealand Herald. A bill
Speaker 2: which would give New Zealanders just one avenue to bet
Speaker 2: on racing and sports online is under the microscope. The
Speaker 2: amendments to the Racing Industry Act would make TAB New
Speaker 2: Zealand the sole legal domestic operator of online racing and
Speaker 2: sports betting. The TAB estimates kiwis lose one hundred and
Speaker 2: eighty five million dollars a year to offshore operators, with
Speaker 2: the changes expected to retain this money. It's all well.
Speaker 2: The tab's operator, Enchain, faces allegations of not doing enough
Speaker 2: to combat money laundering and corruption in Australia, and there
Speaker 2: are concerns from those in the industry that the monopoly
Speaker 2: would push kiwis onto the black market. Today on the
Speaker 2: front Page Business Desks, Gregor Thompson has been following the
Speaker 2: progression of this.
Speaker 1: Bill and is with us now.
Speaker 2: First things first, Gregor, can you tell me what the
Speaker 2: bill actually is.
Speaker 3: I mean, there's a couple of things, but mainly it's
Speaker 3: an effort to extend the tab's physical monopoly in New
Speaker 3: Zealand to online by making it illegal for online sports
Speaker 3: betting operators to offer wages to New Zealand consumers.
Speaker 1: How does online betting work at the moment in New Zealand.
Speaker 3: So it's pretty easy really. You know, if you are interested,
Speaker 3: you tap in betting or sports betting onto in Google
Speaker 3: and then you'll be presented with a whole bunch of
Speaker 3: different websites. So we're competing for that top spot on
Speaker 3: the Google page. So Betway is one that's registered in Malta.
Speaker 3: There's bet three six five which is registered in Gibraltar
Speaker 3: is obviously the tab and betcher which is their new
Speaker 3: betting portal, and then there's sports bet which is an
Speaker 3: Australian outfit, and there's other ones like bet vector and
Speaker 3: uni bet. And then once you decide one you want
Speaker 3: to use, verify your age, so you could do that
Speaker 3: with a driver's licenses or a passport. Sometimes you'll be
Speaker 3: required to prove where you live with a bad statement,
Speaker 3: and then some of them will even want to want
Speaker 3: to know that the credit card you're operating with us,
Speaker 3: you're se might have to send a picture of that.
Speaker 3: But then once you're on you can shop around like
Speaker 3: you would for any other good service and try to
Speaker 3: find the best odds and then place your bet.
Speaker 4: Right.
Speaker 2: So the Racing Amendment Bill that'd give TAB and Z
Speaker 2: a monopoly on online sports and racing betting in New Zealand.
Speaker 2: So essentially it wouldn't matter if you typed in betting
Speaker 2: in Google, you'd only have one place to do it, right.
Speaker 3: Yeah, So what it would do it would block those
Speaker 3: offshore companies from selling wages to news and consumers. Now
Speaker 3: this was more or less the case prior to the
Speaker 3: inception of the Internet, so New Zealand sports gambling market
Speaker 3: is relatively unusual on the global context because in Zen
Speaker 3: is a government sets to ey body that holds and
Speaker 3: has held for more than a century, monopoly on physical
Speaker 3: sports betting in New Zealand. Historically, TNB, TAV and Z
Speaker 3: operated the TRB with its stores and app and track side,
Speaker 3: So before the inception of the internet's TRB had a
Speaker 3: monopoly just by virtue of being of being difficult to
Speaker 3: place bets with overseas operators, although I have heard of
Speaker 3: people ringing up Australian bookies back in the past to
Speaker 3: place bets. But yeah, So the central purpose of the
Speaker 3: Racing Industry Amendment Bill is to extend the physical monopoly
Speaker 3: to the eternet by making it illegal to sell wages
Speaker 3: online to New Zealanders, thus returning to the way things
Speaker 3: were back before the Internet.
Speaker 5: Kind of.
Speaker 4: The way that the legistive sinners have been here in
Speaker 4: these Zealar for ages is that they're allowed to operate
Speaker 4: here with almost impunity. So, you know, when we operate,
Speaker 4: we have a whole series of rules we have to follow.
Speaker 4: We have to put safer gambling standards, and we have
Speaker 4: to have relationships with the government and with community leaders
Speaker 4: and whatnot. These operators don't abide by any of that,
Speaker 4: you know, So they can put ads into market with
Speaker 4: absolute impunity, and I would say that in many cases
Speaker 4: they push things way, way, way too far. The ads
Speaker 4: that bring the McCullum was in for a while there,
Speaker 4: portraying him as a lavish kind of successful person through
Speaker 4: his bidding. That's just not something we could ever do
Speaker 4: down here or whatever want to do down here. But
Speaker 4: the fact that they were able to do that and
Speaker 4: push it so hard in New Zealand is a real
Speaker 4: fault in the legiosative settings, as we say it.
Speaker 1: What are some of the concerns here?
Speaker 3: So the new Zealand's approach. I guess there's rooted in
Speaker 3: the belief that a government run entity can ensure better regulation,
Speaker 3: provide responsible gambling initiatives, and generate revenue for public use,
Speaker 3: such as funny for sports organizations. For instance, when the
Speaker 3: privatized system, money would not be recycled through national sporting
Speaker 3: organizations and would instead go to places like Gibraltar and Malta.
Speaker 3: And also, exponents of the system argue that tab Z
Speaker 3: oversight increases the capacity to monitor and reduce gambling arm
Speaker 3: and New z own communities. However, some argue that such
Speaker 3: monopoly limits choice for consumers and can lead to inefficiencies
Speaker 3: in the market. So a lot of my reporting has
Speaker 3: been kind of based on this issue. So some of
Speaker 3: the submissions on the bill argue that extending the monopoly
Speaker 3: online would lead to less favorable odds because of a
Speaker 3: lack of competition. So, you know, the Commerce Commission is
Speaker 3: currently trying to increase a competition in the banking sector
Speaker 3: in the grocery sector, and they see this as them
Speaker 3: doing the opposite and that would lead to less favorable
Speaker 3: kind of odds or wages for New Zealand punters. So,
Speaker 3: for instance, there's a golf tournament that's supposed to start
Speaker 3: today called the Genesis Invitational. On the TB, American golfer
Speaker 3: col Mari Kawa is paying thirteen dollars to win, but
Speaker 3: on bet three sixty five he's paying fifteen dollars to win. So,
Speaker 3: in other words, the TV odds are fifteen percent more expensive.
Speaker 3: Now this varies across different platforms, but you know, sometimes
Speaker 3: the tab's odds are more favorable, particularly in things like rugby,
Speaker 3: where New Zealand bets. New Zealand is bet quite a lot.
Speaker 3: But what people who are against this proposal argue is
Speaker 3: that the lack of choice, you know, INTAIN and the
Speaker 3: TIB would be able to basically just set pricing and choose,
Speaker 3: choose what they offer to consumers. I have, as en
Speaker 3: tain and Minister for Raising Winston Peters if these arguments
Speaker 3: have any grounds, and they and you know, if a
Speaker 3: monopol would lead to less competitive pricing on all less products.
Speaker 3: But they didn't respond to those particular questions. But also
Speaker 3: the betting people that call themselves sharp betters, the people
Speaker 3: that often win or do quite well out of other
Speaker 3: betting acknowledge that there is much public sympathy for.
Speaker 1: Their elk gregor what else have you seen from the submissions?
Speaker 3: One interesting part of the submissions is that Winston Peters
Speaker 3: and the tairbn Z contend that this bill will reduce
Speaker 3: gambling home because it will bring all of sports betting
Speaker 3: in New Zealand under regulatory control of tibn Z. But however,
Speaker 3: in the submissions against the bill, there are some people
Speaker 3: who argue that actually it could potentially increase gambling harm
Speaker 3: because if the odds are worse than they are now,
Speaker 3: troubled gamblers who aren't necessarily paying that much attention to
Speaker 3: the odds and are just trying to scratch an itch
Speaker 3: would theoretically lose their money faster than they would if
Speaker 3: the odds were better. Which again I asked Winston Peters's
Speaker 3: office and intain about that. They assured me that under
Speaker 3: the regime it would be more safer and Humbrevention would
Speaker 3: be better than New Zealand.
Speaker 2: So a twenty five year strategic partnership between TAB New
Speaker 2: Zealand and NTANE Australia launched in June twenty twenty three.
Speaker 1: What are the details of that deal?
Speaker 3: Yeah, so that's right. It was roberstent by the previous
Speaker 3: Racing Minister, Kurer macinnulty. A commencement in Tain made an
Speaker 3: upfront payment of one hundred and fifty million dollars to
Speaker 3: TDNZ and committed to a guaranteed minimum return of one
Speaker 3: hundred and fifty million dollars until twenty twenty eight and
Speaker 3: then beyond that. So beyond twenty twenty eightbnz WI was
Speaker 3: see fifty percent of the revenue generated through the partnership
Speaker 3: and no guaranteed minimum funding will apply, so after that
Speaker 3: there's a shared revenue model, and then under the terms
Speaker 3: of the deal, INTAIN also read to pay other one
Speaker 3: hundred million dollars of Peter's bill has passed. INTAIN and
Speaker 3: the TB have also suggested in this submission on the
Speaker 3: Racing Industry Amendment that the definition of online sports betting
Speaker 3: they extended to include virtual sports, and if this takes place,
Speaker 3: TBNZ is also expected to get another fifteen million dollars
Speaker 3: from NTAIN.
Speaker 2: Is there a sense that Inntain's chucking money at something
Speaker 2: that they want to happen?
Speaker 1: I suppose.
Speaker 3: I mean, I can't speculate under the intensions of INTEN,
Speaker 3: but I can say that they seem to think that
Speaker 3: there is a lot of value in you know, this
Speaker 3: legislation going through, given that they have committed to paying
Speaker 3: one hundred million dollars towards it being passed. So I suspect,
Speaker 3: you know, the company's rational and they think they'll get
Speaker 3: a return on that investment.
Speaker 1: Well, yeah, I mean, of course they will.
Speaker 2: They'll have the monopoly over online sports betting and racing
Speaker 2: betting in New Zealand. I mean, it does seem quite
Speaker 2: strange to have one company. And like you said, you
Speaker 2: brought up the growthery and banking sectors. Why do you
Speaker 2: think racing and sports betting has not gained I guess
Speaker 2: the same kind of momentum as those other sectors.
Speaker 3: I think there's probably less public sympathy for consumers of
Speaker 3: betting products than there are for consumers of grocery items
Speaker 3: or loans in a way. And also, I mean the
Speaker 3: Minister and the TV and intain argue that having a
Speaker 3: whole bunch of multinationals who are less restricted by a
Speaker 3: New Zealand regulation provide betting wages to New Zealanders could
Speaker 3: increase gambling harm and then so bringing all of the
Speaker 3: betting onshore and thus under tv in Z's regulatory control
Speaker 3: would reduce that risk of gambling harm and the benefit
Speaker 3: of that is worth the less impetative consumer environment.
Speaker 5: I think we shouldn't just based off a lot of
Speaker 5: the submissions we've had, which is around the monopoly component
Speaker 5: and so from consumers. We've also heard from some alternative
Speaker 5: providers that operate in Australia and the like around that
Speaker 5: monopoly component and whether that's actually beneficial to consumers who
Speaker 5: use the product. So just interested in the process that's
Speaker 5: happened behind the scenes around that.
Speaker 2: Well, there's an old marriage thing. We paid the price,
Speaker 2: we plucked the duck.
Speaker 1: Clear responses.
Speaker 2: I've heard some submissions from competing companies though, but I
Speaker 2: think they make a point in that if this happens,
Speaker 2: it'll push kiwis onto black market platforms. I mean, that
Speaker 2: can't be too difficult to understand that that might happen, right,
Speaker 2: I mean, some drugs are illegal in New Zealand, but
Speaker 2: they still make their way to our shores.
Speaker 1: Is that a main con concern for people that you've
Speaker 1: spoken to.
Speaker 3: Not necessarily the people that I've spoken to. I mean,
Speaker 3: that is clearly at risk, and the Minister and you
Speaker 3: know that has acknowledged that that will likely happen, that
Speaker 3: very committed sports betters will find a way around the
Speaker 3: law using things like cryptocurrencies, et cetera. For the main
Speaker 3: credible one so betwey bet three six five sports bet
Speaker 3: Unlikely that will still be that it will be possible
Speaker 3: to bet with them using a VPN, because you still
Speaker 3: need to verify your age and your address and give
Speaker 3: if you give them a New Zealand address that they
Speaker 3: will be legally obliged not to let you bet with them.
Speaker 3: But on the black market, I guess that is open
Speaker 3: to speculation. One thing I have heard from people I
Speaker 3: have spoken to is that they're more concerned that people
Speaker 3: will just turn away from betting regardless. So they concerned
Speaker 3: that basically the odds will be so unfavorable that there
Speaker 3: won't be any real incentive to do it anymore, and
Speaker 3: they will just use their time doing something else, will
Speaker 3: find another hobby, Which I mean, if you don't like
Speaker 3: sports betting, then that's probably a good thing. But if
Speaker 3: you're the tab and you want the racing industry to
Speaker 3: be sustainably financed going into the future, then that could
Speaker 3: be a.
Speaker 5: Concern to you.
Speaker 2: What about in tain The company hasn't been without controversy
Speaker 2: over the Dutch hey, with Australia's Financial crimes regulator suing
Speaker 2: after allegations the company hasn't done enough to prevent money
Speaker 2: laundering on their products. It's the first time the regulator
Speaker 2: has actually brought civil proceedings against a business operating online.
Speaker 1: What's happening here?
Speaker 3: Yeah, So in December last year, the company disclosed on
Speaker 3: the London Stock Exchange where it is listed that the
Speaker 3: Australian Transaction Reports in the Nalysis Center or ASTRA, who
Speaker 3: commenced the penalty proceedings that you just cited in the
Speaker 3: Federal Court of Australia. Like you said, the proceedings relate
Speaker 3: to alleged contraventions of Australian Anti Money Laundering and CANi
Speaker 3: Terrasm Financing Act. You know. I talked to z about
Speaker 3: this and the company spokesperson told me the company is
Speaker 3: carefully considering the application by OSTRAK. He said that these
Speaker 3: issues were localized to intent Australia's business. Peter's spokesperson told
Speaker 3: me it wouldn't be appropriate to comment on a legal action,
Speaker 3: but that the Minister has been briefed on the matter.
Speaker 3: He said, tav in Z's board has sort of assurances
Speaker 3: from Intane regarding the action and have advised that Intane
Speaker 3: I have engaged and cooperated fully with Obstract but after
Speaker 3: that so. Also in January, reut has reported that Britain's
Speaker 3: accounting watchdog has started an investigation into the audit conducted
Speaker 3: by KPMG on the financials of Intan in twenty twenty two.
Speaker 3: That it should be set as an investigation into KPMG,
Speaker 3: not Intane, but it's it is true that there are
Speaker 3: two watchdogs looking into Intan specifically in Australia, but then
Speaker 3: Intan adjacent stuff in the UK.
Speaker 1: Thanks for joining us, Gregor, thank you very much.
Speaker 2: That's it for this episode of The Front Page. You
Speaker 2: can read more about today's stories and extensive news coverage
Speaker 2: at enzdherld dot co dot nz. The Front Page is
Speaker 2: produced by Ethan Sills and Richard Martin, who is also
Speaker 2: a sound engineer.
Speaker 1: I'm Chelsea Daniels.
Speaker 2: Subscribe to the Front Page on iHeartRadio or wherever you
Speaker 2: get your podcasts, and tune in on Monday for another
Speaker 2: look behind the headlines.