Written Reply to Parliamentary Question on Evidence That Legal Online Gambling Reduces Illegal Online Gambling by Mr K Shanmugam, Minister for Home Affairs and Minister for Law

Question:

Mr Leon Perera: To ask the Minister for Home Affairs whether, to what extent and by what evidence the experience of Hong Kong and Norway (or that of any other countries studied by the Ministry) demonstrates that allowing some legal online gambling will (i) cause a significant switch of current illegal gamblers to legal gambling and (ii) not cause a significant expansion in the total population of gamblers for both legal and illegal gamblers.

Answer:

1. Similar to Singapore, Hong Kong and Norway have also allowed authorised operators to complement a general prohibition of remote gambling. These authorised operators run remote gambling services in a highly regulated environment.

2. The nature of remote gambling, especially underground illegal gambling, is such that it is hard to get accurate details of the extent or the exact number of people who are gambling. There may be a range of estimates, and this applies to any jurisdiction.

3. There are some studies and analyst reports on the experiences of Hong Kong and Norway. They suggest that an exempt operator regime can mitigate the extent of unauthorised remote gambling.

a. Hong Kong's authorised operator, Hong Kong Jockey Club (HKJC), launched its online betting service in 2001, and its mobile app-based betting in 2011. A report from H2GC consultancy estimates that the share of the remote gambling market in Hong Kong attributed to unauthorised offshore operators halved, between 2003 and 2015.

b. Norway's authorised operator, Norsk Tipping, launched online casino games in 2014. Gambling prevalence studies commissioned by the Norwegian Gaming and Foundation Authority indicate that the percentage of Norwegians who played illegal online casino games decreased by about one-fifth between 2013 and 2015.

4. Hong Kong and Norway's experience also suggest that allowing for authorised operators has not resulted in higher gambling participation rates.

a. Studies commissioned by the Home Affairs Bureau in Hong Kong indicate that the share of the Hong Kong population that participated in gambling decreased from about 78% in 2001 to 62% in 2011.

b. Studies commissioned by the Norwegian Gaming and Foundation Authority indicate that the share of the Norwegian population that participated in gambling decreased from about 70% in 2007 to 58% in 2015.

5. Even as we take into account the experiences of other jurisdictions, we need to be careful about drawing strict parallels with them. Notably, the social context and the regulatory environment differ from one jurisdiction to another.

6. So while we learn from their experiences, we will continue to closely monitor the situation in Singapore and make adjustments if necessary, to ensure that our Exempt Operator regime achieves its objective of mitigating law-and-order and social concerns arising from unauthorised gambling.