New Zealand Online Casino Regulation Advances as Government Seeks to Shift Players from Grey Market to Licensed Sites

New Zealand’s push to regulate online casinos is not about introducing gambling to the country but about bringing an already active market under government oversight, according to the nation’s top gambling regulator.

Speaking at the Regulating the Game Conference in Sydney, Paul James, Secretary of Internal Affairs and Chief Executive of the Department of Internal Affairs (Te Tari Taiwhenua), said the proposed Online Casino Gambling Bill is designed to guide New Zealand players toward licensed and regulated platforms.

According to James, the legislation aims to close a major regulatory gap created by the current framework under the Gambling Act 2003, which prohibits domestic operators from offering online gambling but does not prevent offshore companies from serving New Zealand customers.

“The reality is online casino gambling is already part of New Zealanders’ lives today, but without protections,” James explained. “The bill will close that regulatory gap and bring the activity into a transparent, regulated environment.”

A Licensing Model Based on Existing Player Behavior

One of the key elements of the bill is a cap of up to 15 online casino licenses. The number is not arbitrary. Government data indicates that more than 95% of New Zealanders who gamble online currently do so on roughly 15 offshore platforms.

By mirroring existing consumer behavior, regulators hope to strike a balance between offering sufficient choice and maintaining effective oversight.

James noted that limiting the number of licenses would help authorities maintain stronger harm-reduction standards while still allowing operators to run sustainable businesses.

“This cap will balance consumer choice,” he said. “Players will be able to choose among those licensed providers while allowing regulators to better manage growth and enforce harm-minimization measures.”

Advertising and Stronger Enforcement Against Illegal Sites

The new regulatory framework will also introduce controlled advertising for licensed operators, allowing them to promote their services while ensuring strict rules around responsible marketing.

Advertising will be restricted to prevent targeting minors and must align with the country’s harm-reduction objectives.

At the same time, enforcement against unlicensed operators will be significantly strengthened. The proposed law introduces takedown powers against illegal gambling sites and increases penalties dramatically.

Under the new rules, offshore operators could face fines of up to NZ$5 million (US$2.9 million)—a substantial increase compared with the current maximum penalty of NZ$10,000.

“What we’re trying to do is channel people away from unregulated providers and toward licensed operators,” James said. “When players choose licensed sites, they know there are consumer protections, safety standards and fair practices in place.”

A Growing Online Gambling Market

The urgency behind the legislation reflects the rapid expansion of the country’s online casino market.

Recent estimates show that New Zealanders spent approximately NZ$1.3 billion on online casino gambling in 2025, representing a 10% increase from the previous year.

For regulators, the growing market highlights the need for stronger oversight to ensure player protection while keeping the sector competitive enough to attract users away from offshore platforms.

“If the balance is wrong and the system is too restrictive, players will continue to use black-market sites,” James warned. “That would leave New Zealanders gambling without any protection or support.”

Timeline for the New Regulatory Framework

The Online Casino Gambling Bill recently passed its second reading in Parliament and is expected to move through the next legislative stages in the coming weeks.

If approved, the government has outlined the following implementation timeline:

1 May 2026: Legislation comes into force

July 2026: Expressions of interest from operators open

September 2026: License auction takes place

October 2026: Formal license applications begin

1 December 2026: Only licensed operators may legally offer online casino services in New Zealand

Operators already serving the market and submitting applications will be allowed to continue temporarily until their applications are decided or 1 June 2027, whichever comes first.

The goal, according to regulators, is clear: transition New Zealand’s large but largely unregulated online casino market into a transparent system with stronger consumer protections and regulatory oversight.