How Online Gambling is Regulated

Another benefit is that regulated gambling will redirect a money stream that usually flows to organized crime in a way that will benefit the local economies and the people. The Brazilian government currently has several bills working their way through Congress that will open up their market to international investment.

In late 2018, they passed a law that will allow for legalized sports betting, but Brazil’s online sportsbooks of the future will have to wait for a two-year trial period while the government irons out the legal framework and licensing procedures.

The only barrier to entry for foreign providers is the economic status of a large portion of the population. However, this is quickly changing, with more citizens gaining regular access to the web every day while data prices continue to drop. India is another major emerging global player, undoubtedly due to see a drastic rise in standard of living and buying power over the course of the next ten years – and probably lasting for the rest of the 21^st century, at least.

Every day that’s hundreds-of-thousands more residents using mobile devices to interface with the internet as a regular part of their day. This will surely be to the benefit of online gambling sites operating both offshore and as licensed providers within the Indian states.

At the same time, brick-and-mortar casino mogul Sheldon Adelson was successful in convincing the federal government to re-interpret Robert Kennedy’s 1962 Wire Act bill to prohibit making casino-style bets over a phone line – or now – the internet. This is a controversial challenge, as the wording of the law clearly states it was only meant to pertain to sports wagering, but hundreds-of-millions in campaign donations can buy you some pretty creative federal interpretations.

So, while one side of the industry in the US looks extremely promising, another is coming under fire. Still, over time most of the country’s states are expected to adopt gambling regulations and licensing regimen, so that they may profit from betting rather than watch their prohibition merely fund corporations outside of the border.

Other situations weren’t so clear cut, but lawmakers immediately sprung to action, making definitive decisions concerning their interpretation of older laws – whether for legalizing and regulating gaming, or banning it altogether – or choosing to pass new ones.

A few locations have moved to block gambling on the web, despite having regulated land-based providers. Then, there are the multitude of countries who may have a series of laws related to gambling prohibition and may even consider online casinos and sportsbooks illegal, but all of the rules and punishments only apply to the operators and not individuals accessing the domains.

UIGEA was signed into law in 2006 and is designed to prevent online gaming in regions where it’s unlawful. However, the bill does nothing to address individual bettors who choose to play on offshore sites. Instead, it focuses on the site owners and US banking institutions. The law restricts banking institutions from processing transactions between their customers and known gambling operations.

The federal restrictions are fairly lax for players who wish to gamble online: you can’t accept money for a bet across state lines – which only affects bookies or people taking action – and you have to find alternative ways of funding your offshore website’s betting wallet other than directly transferring from your debit card or checking account. Credit cards, e-wallets, and cryptocurrencies are all popular options.

Besides those relatively insignificant rules, the United States consists of fifty unique gaming jurisdictions. Each state is responsible for writing and passing their own legislation, designing the licensing regime, creating regulatory authorities, and deciding what forms of gambling are – and what are not – legal.

Since the Supreme Court repealed PASPA, an anti-sports betting bill, states have scrambled to either move towards legalization or prohibition — in cases where the local government never bothered to enforce a ban since the fed’s covered it.

Either way, in the majority of jurisdictions, the laws all prevent an operator from setting up shop in their state but don’t criminalize US citizens utilizing offshore gambling sites. And that’s why we call situations like this “a gray area,” when it comes to gaming laws.

To get around this, pachinko parlors reward tokens for a player’s winnings, which can then be exchanged for prizes at a front desk. These gifts are often a small sliver of gold in a plastic casing or something similar. The player then takes what they won next door, where there’s a shop – owned by the same person running the pachinko spot – that will buy your prize for cash.

Online gambling laws can be similarly worked-around. Japan doesn’t have specific statutes to regulate or even define internet-based gaming. As a result, they also don’t have a licensing process. Nevertheless, it’s generally accepted that placing bets online violates the Japanese Penal Code. Still, it’s doubtful that accessing or playing with offshore providers will be monitored or enforced.

Between the recent sports betting bill that was passed and is currently having regulations drawn up by the Ministry of Finance, and the online gambling bill that’s been the subject of debate in the Brazilian House of Representatives, it appears the country is headed towards a future of well-defined, licensed, and controlled web-based gaming.

However, in the meantime, while still operating without any specific rules or regulations regarding the use of offshore sites, residents of Brazil may access foreign domains to place their bets without any fear of punishment. If anything, the country’s market will become stricter and more prohibitive when the legal framework is created and implemented.

In fact, in the vast majority of jurisdictions, we see people logging-on and using web-based operators, even if it’s done in spite of very clear laws prohibiting the act. While there may be rules about domain-owners on the books, they’re often unenforceable in the jurisdictions in which the websites are hosted. If there aren’t specific criminal punishments aimed at residents, neither side of the transaction has anything to worry about, unlawful or not.

Then you have the regions – China, for example – in which there are clear and serious laws prohibiting citizens from using unapproved websites. Even still, offshore sites make enormous revenues from mainland China, where players are willing to use VPNs and risk being caught and fined in order to access foreign gambling markets and games that can’t be legally found in the country.

While the censorship of the internet is nothing new for the communist Asian superpower, the blocking of offshore IP addresses is a common practice that’s used by France, Switzerland, Austria, and many others, either to prevent unlicensed businesses from providing services, or to preserve a market monopoly. Still, there are always ways around these bans without any real consequences for using them in most cases.