Gambling Law Confuses Web Hosts

A Sydney e-commerce solutions company may have run afoul of new online gambling laws by providing web-hosting services for an overseas cybercasino.

The dilemma facing Activ Australia underscores the confusion created by the three-month-old Interactive Online Gambling Moratorium Act. Three months after it became law, few industry operators know its details or who is responsible for monitoring compliance or enforcing its provisions.

Activ Australia has been renting server space which allows internet casino to operate its Star Online Casino at the Australian web address The name and country code are deceptive - the cybercasino is in fact owned and operated out of eastern Canada and has no links with Sydney's Star City.

While that may be misleading, it is not illegal. The real issue is whether Activ is acting as an agent for by supplying it with web hosting, according to legal experts. Australian agents for overseas cybercasinos are subject to the legislation, say internet specialists Patrick Fair and Liong Lim of law firm Baker and McKenzie. "If Activ is letting them provide a service out of their server, that would raise questions," said Fair.

Hosting gaming content under a sub-domain of the domain could also invite attention from the NSW Racing and Gaming Department, Lim suggested.

If Activ's only role was providing redirection service to's Canadian gaming site, it would not breach the act, other industry sources said.

Activ CEO Tim Watson said the relationship simply involved selling web space to the offshore company. "We are not acting as their agents in promoting their services. They pay their bills every month and they do what they do ... I've never had any feedback or complaints."

Watson said he did not know how much traffic was being attracted and declined to name the customer for reasons of commercial confidentialty. On the topic of the site's deceptive name, Watson said he was "not really concerned about it. People who gamble may be addicts but they are not stupid. If they can't tell by looking at it that it is an overseas operation, well, what can you do?

"I object to hate sites or pornography but if people want to get their fingers bitten gambling on the net, that is up to them."

Australian Casino Association executive director Chris Downy noted that the Canadian cybercasino using the Sydney web address has been unaffected by the moratorium. "It shows the legislation is totally ineffective," he said.

"Legitimate and legal operators such as Lasseters and Crown and Federal have complied with the law and done the right thing while people who do not even have a licence to operate in Australia can get away with it with impunity."

Meanwhile, other effects of the legislation are emerging. The Australian-developed cybercasino company has been bought out by overseas interests from Dubai, Asia and South Africa. It opened its doors on the web this month from a site in Vanuatu under the name The moratorium left the company's directors with no option but to sell, said former CEO Andrew Spinks.

A second project, skill-based games tournament site Planetgamz, was not affected by the moratorium and could be launched by the second half of this year, Spinks said.

Courtesy The Australian Industry Standard:

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