British bookmaker William Hill could be set to exit the Australian market following a regulatory crackdown against online betting operators.
News of the potential sale came via a note to the London Stock Exchange (LSE) on January 15. In addition to providing an update on the publicly listed company’s 2017 earnings, the statement said that a “strategic review” of its Australian operation was underway.
Big Business but Tough Regulations
Despite the Australian gambling market being worth in the region of $23 billion per annum, online sites are facing increasingly difficult operating conditions thanks to government regulation. A blanket ban on free bets has essentially curtailed the ability to offer bonuses and incentives to customers.
Additionally, a point of consumption tax looks set to roll out across the country throughout 2018 and into 2019. Under the law, any state that uses the new tax system will be able to impose a 15 percent levy on an individual’s bets within the state’s borders.
These regulatory shifts have become a concern for William Hill’s board and executives.
“Given the credit betting ban in Australia and the likely introduction of a point-of-consumption tax in a number of states, it is clear that profitability will increasingly come under pressure,” read the company’s LSE statement.
Another Blow for Betting Operators
Although William Hill is yet to make any formal announcements, the move would be another blow for Aussie betting fans. In 2017, a ban on online poker forced major operators such as PokerStars to exit the market.
While there is hope the poker ban will be reversed, the current state of play suggests that the government is looking to tighten its hold over the iGaming industry further. For William Hill, these changes are the latest in a long-running battle with the Australian federal government.
The Interactive Gambling Act 2001 made it illegal for online bookies to offer in-play and live sports betting. To skirt the regulation, UK-based operators such as William Hill were able to direct customers from their website to a phone service.
This system allowed operators to offer live bets but escape any legal sanctions. However, despite being legal, the practice always irked those in the government who want to see less gambling online.
To address the phone betting dynamic, the Interactive Gambling Amendment Bill 2016 outlawed the practice. With in-play betting a huge part of every bookmaker’s bottom-line, including William Hill’s, the 2016 amendment was a significant blow for the industry.
With the latest changes compounding the 2016 amendment, William Hill may now be forced to cut its losses in Australia.