Global online gambling regulation evolves rapidly to address new technologies and markets

The online gambling industry has undergone rapid global growth and evolution over the past decade. Advances in technology have enabled gambling operators to expand their offerings and geographic reach while governments worldwide grapple with regulating this fast-changing industry.

Rapid Market Growth Prompts Regulation of Foreign Operators

The global online gambling market surpassed $66.7 billion in gross winnings in 2020, reflecting explosive growth from $29.3 billion in 2014. Much of this growth has come from operators based in one country providing internet gambling services to citizens of other countries lacking a regulated online gambling market. Governments around the world have scrambled to enact new laws and licensing frameworks to regulate foreign operators, like Casino Nine, driven by goals of protecting vulnerable citizens, capturing tax revenue from a growing market and enforcing national values around gambling.

Europe has led the way on this front after finding in 2010 that all members of the European Union would need to allow regulated online gambling markets domestically in order to enforce restrictions on unlicensed foreign operators. Germany enacted the Interstate Treaty on Gambling in 2021, requiring all unlicensed foreign gambling websites to block German IP addresses or face criminal charges. At the same time, Germany began issuing sports betting and online casino licenses to operators who agree to follow strict rules around consumer protections and tax payments. Smaller European nations have followed suit, with 17 of 27 EU members now offering licensed online gambling markets.

Beyond Europe, jurisdictions as diverse as Mexico, Thailand, Japan and Kenya have also recently enacted new laws to block unlicensed foreign operators and establish licensing frameworks. Their aim is to steer citizens towards strictly regulated domestic operators who must adhere to national public policy goals around responsible gambling and taxation.

Stricter Rules Enacted Around Advertising and Game Design

A second clear trend is governments tightening rules around gambling advertising and game design elements that pose addiction risks to vulnerable citizens. Numerous studies have linked excessive gambling advertising and features like fast gameplay and cash bonuses to problem gambling behaviour.

Sweden enacted a new Gambling Act in 2019 that is a case study for this strict approach. All licensed operators are barred from offering sign-up bonuses and other financial incentives to players. Sports betting ads are heavily restricted around live events, and operators cannot advertise to customers who have self-excluded or opted-out from marketing. Slot games are prohibited from featuring autoplay functionality or speeding up the time between spins. This groundbreaking law aims to allow a healthy gambling market while mitigating social harm.

The UK – the largest regulated gambling jurisdiction globally – has also been tightening rules incrementally in recent years around marketing and game design. A whistle-to-whistle ban on betting ads around live sports went into effect in 2019. Slot games can no longer feature sounds/imagery that imply big wins to players on losing spins. New affordability checks require operators to monitor each customer’s spending and intervene with high-risk players. These changes indicate a shifting regulatory focus towards balancing economic benefits of gambling with responsible gambling measures.

Cross-Border Cooperation Drives Higher Standards

A third key trend is cooperation between regulators across jurisdictions to share best practices, enforce standards on multi-national operators, and combat unlicensed offshore sites.

International bodies like the European Gaming Regulators Network (GREF) and the International Association of Gaming Regulators (IAGR) have gained prominence as venues for officials to collaborate. GREF members have worked together on issues like unlicensed gambling websites targeting citizens across Europe and ensuring licensed B2C operators adhere to regulations in all jurisdictions they serve.

Groups of neighbouring countries have also formed regional regulatory partnerships. The Nordic Gambling Regulators’ Forum comprising Denmark, Iceland, Finland, Norway and Sweden cooperates on auditing multi-national gambling operators active in their connected markets. A new Latin American Gaming Regulators Association launched in 2021 aims to foster information-sharing and cooperation on enforcing standards across Central and South American countries.

These cross-border efforts ultimately increase oversight and consistency for global operators while building consensus towards ethical gambling standards worldwide. They help offset the complexity of disparate regulations market-by-market.

Path Forward or Balancing Innovation With Protection

Rapid innovation will continue in the online gambling sector, as new technologies like virtual reality gaming and cryptocurrency payments gain traction. Governments face the difficult balancing act of encouraging innovation for economic growth while updating regulations to match the pace of change. Players demand ever-more immersive and convenient experiences, while society aims to mitigate the risk of addiction and other damages linked to excessive gambling.

The trends outlined above will likely lead towards globally harmonized regulatory models balanced between consumer choice and responsible gambling safeguards. Progress already made on once-disparate issues like foreign operator oversight and advertising content standards shows the ability of governments to adapt collaboratively. Countries and operators will continue probing to find the right formula – one that gains public trust through firm protections while supporting a thriving, ethical online gambling marketplace worldwide.

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Adam Regan

Deputy Editor

Features and account management. 3 years media experience. Previously covered features for online and print editions.

Email Adam@MarkMeets.com