The Remote Gambling Act 2014 (the “Act”) which provides the legislative framework to regulate remote gambling activities in Singapore has come into force on 2 February 2015.
The Act prohibits all forms of remote gambling activities, unless exempted, and enables the Singapore Government to introduce a comprehensive set of blocking measures, such as website blocking, payment blocking and advertising bans.
Social games excluded from scope of Remote Gambling Act 2014
When the Act was passed in Parliament on 7 October 2014, it was explained that the Act will not impede the development of the gaming industry in Singapore. The Act does not target games in which the players do not play to acquire a chance of winning money, and where the game design does not allow the player to convert in-game credits to money or real merchandise. The Act thus does not cover social games such as Farmville and Candy Crush Saga in their current forms.
On 28 January 2015, the Media Development Authority of Singapore (the “MDA”) issued a press release reiterating that the Act does not cover games which do not, as part of the game design, enable players to receive money or money’s worth consequent to the outcome of that game. Therefore, the following types of games are not covered by the Act:
- Games which do not allow players to win, through an in-game facility, money or real-world merchandise which can be exchanged for money.
- Games which allow players to purchase or exchange game credits or tokens, but do not provide in-game facility to convert these game credits or tokens to money or real-world merchandise which can be exchanged for money.
- Games which allow players to purchase, gain or exchange game enhancement features, e.g. weapons, skills, but do not provide in-game facility to convert these game enhancement features to money or real-world merchandise which can be exchanged for money.
- Games which rank players but do not provide in-game facility to convert these ranking positions to money or real-world merchandise which can be exchanged for money, such as Tower of Saviorsand 2Fuse in their current forms.
With regard to leader-boards, which rank and reward top players, or tournaments organised by game developers or promoters where players can win real-world prizes, such as League of Legendsin its current form, the MDA explained that, as a general rule, the Act does not prohibit mechanisms to reward players for their skill, provided that these are not within casino-style games or are not used as a means of facilitating syndicated criminal activity.
Obligations of financial institutions
As financial transfers are key to gambling transactions, the Act makes special provisions in this regard requiring action by both financial institutions and financial transaction providers. The Act provides for the blocking of payment transactions to and from the accounts of remote gambling operators. Payment transaction blocking orders can be issued to financial institutions in relation to remote gambling operators. The Act enables the blocking of electronic fund transfers as well as transactions via credit and debit cards.
In this regard, the Monetary Authority of Singapore (the “MAS”) has issued the Remote Gambling Act Order - Payment Blocking Order (the “Order”) which took effect from 2 February 2015. The Order imposes certain obligations on financial institutions in relation to Relevant Persons, i.e. any person notified by the MAS to the financial institution from time to time as a Relevant Person for the purposes of the Order.
The Order applies to the following financial institutions:
- a bank licensed under the Banking Act;
- a card issuer licensed under the Banking Act;
- any holder of a stored value facility under the Payment Systems (Oversight) Act; and
- any operator of a payment system designated under the Payment Systems (Oversight) Act,
(collectively, the “FIs”).
Pursuant to the Order, an FI is required to:
- not accept credit, or proceeds of credit, extended to or on behalf of a Relevant Person;
- not accept any cheque, bank draft, or similar instrument which is drawn by or on behalf of a Relevant Person;
- not make or accept, an electronic funds transfer, or any funds transmission, to or from the Relevant Person; and
- block payments, or otherwise prevent or prohibit transactions to the merchant category codes specified in the Order.
An FI may, upon the request of any of its customers affected by the FI’s actions pursuant to the Order, disclose to that customer, the document received from the MAS identifying the specific Relevant Person. For the avoidance of doubt, the FI shall not disclose information in the document identifying other Relevant Persons.
The full text of the Remote Gambling Act 2014 is available from the Singapore Statutes Online at statutes.agc.gov.sg.