The Department of Internal Affairs

Te Tari Taiwhenua | Department of Internal Affairs

Building a safe, prosperous and respected nation


Licence suspensions reinstated for pokie breaches – court decision

10 December 2013

The Department of Internal Affairs says it is very pleased that the Court of Appeal has clarified the Gambling Act and decided that the suspension or cancellation of licences for past one-off breaches can be imposed.

The judgement calls suspension “an important statutory remedy.”

The Appeal judges say: “There is a strong public interest in ensuring that class 4 operators are held to account and that the requirements of the Act can be enforced in a practical and efficient manner.

“Suspension provides a powerful incentive for operators to comply because, apart from anything else, suspension must inevitably impact on the operator’s relationship with its venue owners. The latter may look elsewhere for an alternative operator who complies with its obligations and avoids shutdowns. “

Today’s judgement also says: “We are satisfied there is a deterrent effect and that the suspension enhances future compliance both by the operator in question and others.

“Suspension may properly be viewed as a useful part of a graduated approach to enforcement, arising between a warning and cancellation. “

The General Manager of Regulatory Services at Internal Affairs, Maarten Quivooy says:
“We believe the use of suspensions is an important method of ensuring compliance with the Gambling Act as this helps ensure that community organisations receive the maximum amount of grant funding from pokie proceeds. Suspensions operate as both a penalty and a deterrent.

“Many societies have signalled to us that they believe the Department should have the power to suspend operators for breaches of the law.

“It is also important that those who comply with the regulations are not disadvantaged by those who deliberately breach the rules.

“Despite the win today, legislative clarification remains the most appropriate course of action and Cabinet has already agreed that a legislative amendment be included in a Supplementary Order Paper to the Gambling Amendment Bill (No 2).”

The decision by the Appeal Court concerns the gaming machine society Pub Charity which in 2009 breached the regulated limit on reimbursing venue operating costs by $286,275. This funding should have been returned to the community in the form of grants.

The Department suspended Pub Charity’s licence for one day, a decision upheld by the Gambling Commission, but appealed by Pub Charity.

In December 2012 the Department of Internal Affairs decided to appeal a High Court judgement (CIV-2012-485-808 [2012] NZHC 3530) which found that the power to suspend operators cannot be used for imposing a penalty for past, non-continuing, breaches.

Mr Quivooy says: “We are committed to ensuring gambling is conducted fairly, honestly and lawfully so that the community gets the maximum benefit from the proceeds from pokies. Being able to impose sanctions for past one-off breaches helps us to penalise societies which are non-compliant and deter others from engaging in similar behaviour.”

The suspension of a licence means that for the period of time involved the society can not operate any gaming machines at the affected venue (s).

Pub Charity’s appeal against the original decision to suspend now returns to the Gambling Commission for fresh consideration in accordance with this judgment.

Media contact:
Sue Ingram Communications, Account Manager,
Department of Internal Affairs Te Tari Taiwhenua
Direct Dial: +64 4 494 0584 |Mobile: +64 27 541 4696