Australia: Victoria is the first Australian state to introduce a pre-commitment scheme for gaming machines.

Type : Focus Paper

On 12 December 2013, Victoria passed the Gambling Regulation Amendment (Pre-commitment) Bill 2013 (the Bill), making it the first Australian jurisdiction to introduce a pre-commitment scheme for gaming machines. The Bill, which is awaiting assent, requires that all venue operators link to a state-wide pre-commitment system by 1 December 2015.

The Bill provides for a 'double voluntary' pre-commitment scheme, making it voluntary for players to:

• use the scheme; and
• set a limit.

The pre-commitment system will, however, be mandatory and must be installed on all gaming machines installed at gaming venues in Victoria.

Gambling Regulation Amendment (Pre-commitment) Bill

In our article "Gaming Machines and Pre-Commitment: National Gambling Reforms Become Law"¹ we summarised the Federal legislation² (the National Gambling Reform Package) regulating the operation and use of gaming machines and addressing other issues associated with problem gambling. The National Gambling Report Package, among other things, required:

• all gaming machines to be equipped with pre-commitment capability by 31 December 2014;
• ATM's located at gaming venues to have a 24 hour $250 withdrawal limit; and
• the introduction of a 'double voluntary' pre-commitment system by 31 December 2018 (or 2022 for smaller venues).

Victoria has chosen to take a more stringent approach than the approach set out in the Federal legislation. From 1 July 2012, Victoria banned ATM's completely from gaming venues and also banned any alternative cash access facility that meant that the customer did not interact with venue staff.

When Victoria introduced the Gambling Regulation (Pre-commitment) Regulations 2012 (the Regulations) in November 2012, it implemented the requirement set out in the National Gambling Reform Package for pre-commitment capability to be available in all gaming machines in Victoria, two years earlier than required.

By implementing a state-wide pre-commitment scheme the Bill introduces the next step required in the National Gambling Reform Package. This will result in this step being introduced seven years sooner than the timeline set out in the National Gambling Reform Package.

Under the scheme to be introduced by the Bill, the monitoring licensee will be required to provide, operate and maintain a pre-commitment system and associated services. It will be mandatory for all gaming machines at all gaming venues in Victoria to be linked to the pre-commitment system. The pre-commitment scheme itself is 'double voluntary', making it voluntary for players both:

• to use the scheme; and
• to set a limit.

The Victorian Commission for Gambling and Liquor Regulation (the Commission) will have regulatory oversight of the pre-commitment scheme. The Bill provides the Commission with new powers to make technical standards for both the pre-commitment system and the equipment that venues will require. The Commission will be required to approve the pre-commitment system and any equipment to be installed on the gaming machines to ensure compliance.

How will the Pre-Commitment System Work?

A player who registers for the pre-commitment scheme will be given a "player card". This can be used to store information on the player's gaming activities, and to apply specified time or net loss limits. Players will be able to use self-service kiosks, which will be located at all gaming venues, to access their gaming information and set pre-commitment features. A card reader on the gaming machine will identify the player, track gaming activity and impose any pre-commitment limits. Players will be able to use the limit they have set on any gaming machine in the state, as well as accessing information on their gaming activities at any gaming venue.

Intralot Gaming Services Pty Limited (Intralot), the current monitoring licensee, has been awarded the contract to provide, maintain and monitor the technology and equipment required to implement the pre-commitment scheme. This decision was, in part, due to the cost-effectiveness of awarding the contract to Intralot as the current provider. Intralot already has monitoring equipment installed throughout Victoria – this will result in less effort for venue operators and less duplication of infrastructure.

The Bill provides the framework for the agreement between the monitoring licensee and the venue operator or casino operator. The Minister can direct that a venue or Crown (as the casino operator), enter into an agreement with the monitoring licensee dealing with matters relating to the provision of pre-commitment services. The Minister can also direct any venue operator (including Crown) to enter into an agreement with the Minister dealing with matters relating to the provision of pre-commitment services.

Venue operators must ensure that gaming machines installed in their venues are compatible and interact with the statutory pre-commitment system. This will require new equipment to be installed, including interactive display screens on gaming machines, card readers, card encoders and keypads. This will be a costly process and it is expected that venues will bear the costs involved.

Linking with Loyalty Programs

Controversially, the player card to be used for pre-commitment purposes can also be used for loyalty programs.

The Victorian Gambling Regulation Act 2003 requires currently that loyalty programs linked to gaming must allow players to set a limit on their gaming machine play. The Bill goes further, requiring the loyalty scheme provider to allow a participant to set a limit on the amount of time or net loss in any 24 hour period, or net loss in any year.

If participants wish to decrease their limit, they may do so immediately. If, however, a participant wishes to increase their limit, that limit will not be effective until the expiration of a 24-hour cooling off period. The loyalty scheme provider must not allow a participant to continue playing games under the scheme after a limit has been reached.

The Bill makes it an offence for a venue or casino operator to knowingly send or direct by any means, advertising or other promotional material relating to gaming to a person who has been removed from a loyalty scheme or to a person who has been suspended from a loyalty scheme during the period of suspension.

In order to avoid confusion by having two pre-commitment systems available (namely the statutory pre-commitment system, and the pre-commitment system available through the loyalty card), the Bill prohibits any other limit-setting mechanisms from operating within a venue other than the statutory pre-commitment system. This means, that if a venue wishes to have a loyalty program, the same player card, card reader, display screen and kiosk will be used for both the loyalty scheme and the statutory pre-commitment scheme.

Linking the pre-commitment scheme with loyalty programs was designed to increase the likelihood that players will use the player cards, by providing an incentive to use the cards and reducing any perceived stigma of a player being part of the pre-commitment scheme.

Critics argue that the linking of the pre-commitment system with loyalty programs is inappropriate and could render the pre-commitment scheme ineffective. It has been suggested that the earning of loyalty points for gaming could reinforce gaming behaviour by encouraging players to spend more than they intend. There is also concern regarding the role of Intralot as the operator of both the pre-commitment system and the loyalty scheme. This could lead to the information collected under the pre-commitment system being used to provide customised promotions to players, again encouraging players to spend more than they intend.

To allay concerns about loyalty schemes being promoted more prominently in the venue over the pre-commitment system, particularly due to the use of the same player card and equipment, the venue will be required to ensure that information relating to pre-commitment is given precedence over information relating to loyalty. Player cards will not be able to bear logos, symbols or other marking associating with gaming machines.

Privacy and Confidentiality

The Bill addresses privacy concerns relating to the use (or misuse) of information collected under the pre-commitment system, by making it an offence to disclose players' personal pre-commitment data without authorisation. Information from the pre-commitment system, which has had all identifying details removed, is able to be used for problem gambling research.

Footnotes

¹ Gaming Machines and Pre-Commitment: National Gambling Reforms Become Law - National Gambling Reform Act 2012, National Gambling Reform (Related Matters) Act (No. 1) 2012 and National Gambling Reform (Related Matters) Act (No. 2) 2012
²National Gambling Reform Act 2012, the National Gambling Reform (Related Matters) Act (No. 1) 2012, and the National Gambling Reform (Related Matters) Act (No. 2) 2012.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.