Online Gambling Restrictions Are Imposed In More Than Half Of The World

Jun 07

Online gambling has seen significant growth in recent years and it is safe to say that it will continue to get even bigger in the years to come. However, the view on the subject and its approval rates, both moral and legal, can vary quite a bit depending on where you are and what regulations are available in the country.

While for people in the UK, online gambling is something normal that a good portion of the population enjoys on a regular basis, in the US things are very different and gambling options in a regulated online environment are limited to only a few states. The difference becomes even more obvious as we add more countries to the calculations and the results show that more than half the population in the world is restricted in some way from enjoying online gambling.

56% subjected to restrictions

KeyToCasino has recently conducted an interesting study in which the regulations from 225 different countries regarding online gambling were taken into account. The findings showed that 56% of the population has to face either a restriction for internet gambling or a complete ban in the respective country.

The mixed situation can be seen in the fact that only 61 countries offer licenses for online casino operators and allow citizens to take part in the regulated options. In 39 countries, internet gambling is prohibited completely, while in 32 of the countries involved in the study, local firms are now allowed to start their own iGaming websites while the offer is made entirely out of foreign operators. A good part of the list, or 93 countries, remains in a somewhat grey zone where the local governments don’t actually prohibit online casinos but they also don’t license them in the markets in order to create a more reliable environment.

The interesting part is that 139 territories now enforce some kind of restrictions in the iGaming industry and this covers about 56 percent of the entire population of the world. It is important to mention however that while these restrictions are active, players are not really prosecuted for not following the local laws to the letter. For example, only 25 of the countries will actively prosecute online gamblers, 15 territories will issue administrative penalties which can include monetary fines and 92 countries don’t enforce any penalties.

When it comes to countries banning online casinos, the most restricted market in the world is the United States, with the study showing that out of 655 online casinos, 72% of them were blocked from being accessed by citizens from the country. We can also add that the remaining 28%, while not being directly blocked, which are still in a grey area and can be considered by all intents and purposes illegal, with the exceptions of the sites available in New Jersey, Nevada and Delaware; but we will get to that a bit later.

USA is followed by France, a country where 70% of the researched online casinos are blocked. Israel is third on the list with 54%.

On the other side of the list we can find Iceland as the country with the fewest restrictions where only 7% of the websites are banned. This is followed by New Zealand, Austria and Argentina.

The study did not overlook land-based casinos and found that out of the list, 168 countries permit their citizens to enjoy casino games in such establishments and 57 of them banned them altogether. An interesting part here is the fact that out of the countries with restricted land-based casinos, 13 of them actually don’t have any active bans for online gambling so players can easily opt for the internet versions.

In most cases, the regulations in the countries that prohibit online gambling are simply out of date. The global industry has grown at a much faster pace than the one new laws have to go through and with the influence from a population which is not very well informed on the matter, the results can easily be seen around the world. Although it is now worth billions of dollars, the iGaming industry can still be considered a young one and much like most internet-related businesses, it will take some time for people to fully understand how everything works.

The good news is that recent years have shown a lot of promise from countries looking to legalize online gambling and the US can be a great example with its recent state-by-state regulations going live in a few regions and showing great promise for the future. It is certainly not easy to turn around such a large ship, especially when the move is opposed from various directions, including from operators of some of the biggest land-based casinos in the country.

UK online gambling increases by 50%

The United Kingdom provides the best online gambling market in Europe and also in the entire world. The regulations have recently been a bit more restrictive with the point-of-consumption tax going live late last year but the industry continues to grow and outperform other countries.

Online gambling operators accepting players from the UK are obligated to get a license from the local Gambling Commission, regardless of their actual location for the headquarters. This has limited the number of websites available in the market but it does provide a more secure and reliable environment for the players.

Not that long ago, the UK Gambling Commission actually released a new report showing the trends in gambling between the years 2008 and 2014. This was made around the information gathered within the country as it relates to online gambling and explored individual activities in the field, as well as overall trends, frequency and more.

The research showed that the annual participation rate in the United Kingdom has increased overall at a growth rate of 8.3%, generating an increase over the mentioned years of around 50%. Remote gambling participation went up from 9.7% (2008) to 15.4% (2014).

A few interesting parts highlighted in the research were that the overall gambling participation among players did no change much with the disposable income, meaning that people continued to enjoy their favorite options even with the economy not doing so well and the income being reduced. However, an association between disposable income and gambling participation was made in the mobile sector where macro-economic factors had a bigger impact. When disposable income increased by 1% per head, the remote iGaming participation also went up by 0.54%.

Going a bit further into the details and we find that the participation rate among males increased to 18% from 11.7%, while the growth among women was a bit lower as it went up from 7.8% to 12.8%. The difference can be explained by the sports betting sector and the increase in mobile activity in this field since males dominate it quite significantly.

The report also showed that that remote gambling participation between the ages of 35 and 54 increased notably over the six year period, reaching 17.6% last year from just 10.6% in 2008. Players over the age of 35 have been found to be more inclined to participate in the National Lottery and other similar events, while also betting on horse racing. Those under the age of 35 are more likely to take part in general gambling activities, according to the presented data.

US is not without options

From the biggest online gambling market we move on to the most restricted, with the United States providing the subject of debate for legalizing internet casinos, poker, sports betting and other options.

As of now, the situation in the US is a bit complicated since online gambling is no longer banned on a federal level but it is also not legal in most states. Individual territories are allowed to pursue legalization and only offer the betting options within their borders, with no interstate connections currently available.

Only three states have legalized and launched some forms of online betting, with New Jersey seeing the most success so far. There are many factors that contribute to this scenario and since New Jersey is much bigger than Nevada and Delaware, the larger potential player pool certainly goes a long way. Added on top are the Atlantic City casinos, which means that a good part of the population is already familiar with some of the games and the gambling concept.

Country-wide however, things are not looking as good. It would be a mistake to say that American citizens from across the nation can’t access online casinos or online poker rooms at any point and from any location. However, these represent the grey market and are not regulated or taxed by the local government.

The offshore poker industry is based around several networks which accept customers from the US and have done so even after Black Friday took place and the government came cracking down on the major cardrooms. These networks have seen great success in recent years and have even went against the decline in the .com market, with the top three US-facing networks all outperforming it by a significant margin in the past two years when it comes to cash games.

While the networks have adopted different strategies in order to solidify their position in the US and in other countries, each of them has offered something innovative that would appeal to a part of the player pool.

Of course, it is not like the networks which don’t accept US players didn’t have innovative features added. The difference however is very simple and the access to a very large market has paid off. Furthermore, poker players from the US have been starving for online gaming since 2011 when the Department of Justice seized assets worth hundreds of millions.

This is a risk that only some networks took and given the fact that there were no public reports showing similar actions against online poker since May 2011, one can easily say that the flop is looking quite favorable. The problem is still one to consider since the government can confiscate hundreds of millions in assets at any point.

When it comes to online casinos, the situation is pretty much the same. While most websites are not accepting players from the US, there are quite a few that do and they offer a great variety of games for all customers to enjoy. The problem here is in the options featured since it is not just the online casinos that don’t cater to US users, but actually the software providers.

Legalization across the country is nothing but a nice dream at this point and while there are some states which have shown interest in online gambling, it generally takes quite a bit of time to get the political wheel spinning. California is the one where everyone is now looking since it is the state with the biggest population but it is only showing signs of interest in online poker within its borders.

Restrictions and ways around them

In conclusion, while there are many restrictions available regarding online gambling, it is also safe to say that ways around them exist and those that want to play can easily find reliable options where they can deposit, gamble and withdraw in a secure environment. The US is the perfect example of a ban that didn’t really work out, with offshore poker rooms and online casinos striving with the help of players from the nation.