Published: 12 July 2021
1. The Ministry of Home Affairs (MHA) will be amending gambling legislation later this year to ensure that our laws and regulations remain effective in the face of evolving gambling products and business models. We would like to invite the public to provide feedback on the proposed legislative amendments.
Key Proposed Amendments to Gambling Legislation
2. Singapore adopts a strict but practical approach in its regulation of gambling. It is not practical nor desirable in fact, to disallow all forms of gambling, as this will just drive it underground, and cause more law and order issues. Instead, we license or exempt some gambling activities, with strict safeguards put in place. Our laws governing gambling seek to maintain law and order, and minimise social harm caused by problem gambling.
3. Our approach has delivered good outcomes. First, gambling-related crimes remain low. Casino crimes have contributed to less than 1% of overall crime since the Integrated Resorts started operations in 2010. The number of people arrested for illegal gambling activities has remained stable from 2011 to 2020. Second, problem gambling remains under control. Based on the National Council on Problem Gambling's Gambling Participation Surveys that are conducted every three years, problem and pathological gambling rates have remained relatively stable, at around 1%.
4. To continue to enjoy these good outcomes, we need to make sure that our laws and regulations can address two trends in the gambling landscape. First, advancements in technology. The Internet and mobile computing have made gambling products more accessible. Second, the boundaries between gambling and gaming have blurred. Business models have adapted to suit changing customer preferences by introducing gambling elements in products that are traditionally not perceived as gambling.
5. To ensure that our laws and regulations governing gambling remain effective in view of these two trends, MHA intends to amend them later this year. The key proposed amendments are in the following areas:
a. Definition of gambling
b. Social gambling
c. Games with gambling elements
d. Penalties across gambling legislation
Definition of Gambling
6. Currently, the definition of “gambling” differs across different pieces of legislation, as these were enacted at different points of time and for different gambling products. We propose to amend the definition of gambling to make it technology-neutral, so that it can cover existing and emerging gambling products. This broader definition of gambling may, however, cover products that MHA has no intention of treating as gambling products (e.g. financial products already regulated by Monetary Authority of Singapore). We will carve out these products from the definition of gambling. This approach has also been adopted in other jurisdictions, such as the United Kingdom, Australia, Switzerland, and Denmark.
7. We currently take a practical approach towards gambling and will only regulate or prohibit when there is a risk to law-and-order, or potential to cause social harm.
8. We recognise that gambling amongst family and friends in homes is socially acceptable amongst many Singaporeans, and poses low law and order concerns. Hence, we are proposing to exempt physical social gambling among family and friends, subject to conditions that safeguard against criminal exploitation. Social gambling among family and friends will thus be explicitly permitted under legislation. We will take strong enforcement action against syndicates which exploit this exemption to conduct illegal gambling activities.
9. MHA considered whether to also exempt online social gambling among families and friends (e.g. gambling over the Internet), but propose not to. Currently, online social gambling is criminalised under the Remote Gambling Act. Explicit exemption of online social gambling will pose enforcement difficulties, as it will be difficult to establish if individuals are sufficiently and meaningfully acquainted with each other in the online context to qualify as social gambling.
Games with Gambling Elements
10. The boundaries between gambling and gaming are blurring. We have reviewed our stance and regulatory approaches, and propose the following for each of the products:
11. Mystery Boxes. Mystery boxes are similar to lotteries, particularly mystery boxes that promise high-value prizes that can easily be traded for cash, such as smart phones and game consoles. As the value of prizes increase, their potential to induce gambling behavior increases.
12. Arcade Games and Claw Machines. Arcades have started to offer high-value prizes such as smart phones to entice patrons. This trend, coupled with the fact that arcade games and claw machines can have elements of chance, is of concern as it brings the operation of these machines close to gambling.
13. We are careful not to over-regulate. We recognise that many Singaporeans consider mystery boxes, arcade games and claw machines as a form of entertainment. However, there remains a need for safeguards to ensure that these activities do not induce gambling behaviour and cause social problems. On balance, MHA proposes to introduce a prize cap of $100 for mystery boxes, arcade games and claw machines. This cap will be sufficient to address the inducement effect of high-value prizes, without increasing the regulatory burden on operators. MHA conducted a survey in 2020 on this proposal, and about 70% and 68% of respondents (comprising Singapore Citizens and Permanent Residents) agreed that $100 is an appropriate cap for mystery boxes and arcade games respectively. Of those who disagreed, about 90% suggested a stricter approach – they suggested a lower cap for both types of games, with the median value suggested being less than $50.
14. Online Games of Chance with Virtual Prizes. It is increasingly common for online and video games to incorporate in-game micro transactions (e.g. loot boxes) that can resemble gambling. Currently, our laws and regulations do not consider such games of chance with virtual prizes as gambling as long as there are no in-game monetisation facilities that allow players to exchange virtual prizes for real-world payouts (i.e. money, or items that can be exchanged for money).
15. We propose finetuning this approach, to maintain the balance between allowing entertainment and safeguarding against gambling inducement. First, we want to update our laws and regulations to address virtual items that can be transferred out of the game, and potentially be exchanged for money or money’s worth on a third-party hosted exchange. We propose to introduce conditions to ensure that transferable virtual items are retained in the context of gameplay and entertainment, as intended by game developers. Online games of chance that allow players to use virtual items from other games as a form of stake on casino games or match outcomes, such as skin-betting sites, will not be allowed. Second, we propose to allow in-game monetisation facilities for free-to-play games (i.e. players do not have to pay to play or receive virtual prizes), subject to conditions similar to those imposed on currently-exempted business promotion lucky draws (which will remain exempted in the new legislation).
Penalties across Gambling Legislation
16. We propose to rationalise penalties across various gambling legislation. The Remote Gambling Act provides a three-tier penalty structure for illegal online gambling. The highest penalties are imposed on operators, as their culpability is greater than that of agents, followed by punters. We propose to apply this penalty structure that differentiates between punters, agents, and operators across all forms of gambling activity, so as to ensure consistency between online and physical gambling activities.
17. We propose to raise penalties for repeat offenders who facilitate or operate illegal gambling services, to increase deterrence. However, we are not proposing to raise the penalties for repeat offenders for punters of illegal gambling services for now. We intend to focus our enforcement efforts on illegal gambling agents and operators.
Details on Public Consultation
18. We welcome your views on the above proposals, along with any other suggestion you may have on gambling legislation. The full report with details on our proposals can be viewed on the MHA and REACH website. Please submit your feedback to us by 10 August 2021 via email at MHA_Gambling_Feedback@mha.gov.sg, or mailed to the following address:
Ministry of Home Affairs
New Phoenix Park
28 Irrawaddy Road
Re: Gambling Legislation Consultation
19. Your feedback is important to us. All views and comments received will be considered.