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Australia bans online betting, home and away

By CNN's Grant Holloway

CANBERRA, Australia (CNN) -- Australians have been banned from gambling at online casinos, regardless of where they are based.

The Interactive Gambling Bill 2001, passed by Australia's Senate late on Thursday, also seeks to prevent non-Australian gamblers from using Australian-based casino-style sites.

The new legislation will attempt to enforce the bans by allowing Australian gamblers to legally default on any credit-card debts they run up on gaming sites, including debt run up on non-Australian-based sites.

The legislation is scheduled to come into effect in six months time.

However, there have been suggestions Friday that this clause may well breach World Trade Organization regarding restriction of trade.

And Australia's NorthernTerritory government is considering launching a legal challenge against the bill claiming the legislation could be unconstitutional.

The Northern Territory is home to the Lasseters Online casino which boasts 160,000 international customers. The casino itself is considering a High Court challenge to the legislation.

Managing director of Lasseters Mr Peter Bridge said he was seeking legal advice on whether those amendments were constitutional, or if they could be challenged as an abuse of ministerial power under the Communications and Crimes Act.

"Our understanding is that we may have a claim for compensation under a High Court challenge," Mr Bridge told the Sydney Morning Herald newspaper.

"It may also be subject to action through the World Trade Organization, given that it restricts our right to international trade."

Australians, renowned for liking a flutter, will, however, still be allowed to place bets on live events such as horse and dog races and football games via the internet.

They will also be permitted to buy lottery and raffle tickets online -- both services which were banned in the original legislation.

Debtors can legally default

Greens Senator Bob Brown says the legislation is groundbreaking  

One of the supporters of the legislation, Greens Senator Bob Brown, described the clause making online gaming debts unenforceable as "groundbreaking".

"It means debtors can legally default," he said.

Brown said this clause would act as considerable disincentive for online gaming sites to target Australian gamblers.

"The legislation is not perfect, but it is an attempt to stop the poker machine plague entering every home in Australia," he told CNN.

In addition, countries that wish to prevent their citizens from gambling at Australian-based sites can register with Australian authorities making it illegal for those sites to subsequently allow gaming services to be sold to those nationalities.

Critics of the legislation suggest the ban will be difficult to enforce and will do little to assist the problem gamblers it is aimed at protecting

Doomed from the outset

"This is a solution that is doomed from the outset because it has been so poorly thought out," head of Australia's Internet Industry Association Peter Coroneos told CNN.

He said banks were unlikely to appreciate being made the enforcers of this legislation, and pointed to the practical difficulties of banks being able to distinguish what is debt illegally generated at a gaming site and legitimate card charges.

Coroneos also suggested the concept of gaming sites "targeting" gamblers was off the mark.

Problem gamblers sought out the sites, not vice-versa, he said.

Describing the legislation as "political grandstanding", he said much of his association's work to introduce workable controls and regulations for internet use in Australia had now been undermined by an impractical attempt to ban undesirable behavior.

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