LOTTOLAND and Planet Lotto will be banned under a Turnbull government crackdown on controversial “fake” lottery websites.

Communications Minister Mitch Fifield will introduce legislation to federal parliament on Wednesday to ban betting on lotteries and keno games.

Lottoland, a Gibraltar-based online gambling company which allows users to bet on the outcome of international lotteries, has come under sustained attack from the newsagent industry with the backing of One Nation leader Pauline Hanson.

“The government has formed the view that permitting betting on these services, also known as ‘synthetic’ lotteries, undermines the longstanding community acceptance of official lottery and keno products,” Mr Fifield said in a statement on Tuesday.

“These products enjoy community support as they generate an income stream for small retail businesses and make a significant contribution, through licence fees and taxation, to the provision of public services and infrastructure by state and territory governments.

“Traditional lotteries and keno games are popular and longstanding recreational gambling products that form an important income stream for thousands of small businesses across Australia, including newsagents, pharmacies, pubs and community clubs.

“They also generate significant taxation revenue for state and territory governments, helping to fund schools, hospitals, public transport and roads.

“Online services offering products that involve betting on lottery outcomes are relatively new and have generated considerable community concern. Since these concerns were first raised last year, the government has listened carefully to a range of groups that have views on the undesirability of permitting betting on these products.”

Betting on lotteries is already banned in South Australia. Lottoland and Planet Lotto are licensed in the Northern Territory as sports bookmakers.

Mr Fifield said the legislation would kick in six months after passage to ensure businesses “have an appropriate transition period within which to cease their activity”.

The Australian Lottery and Newsagents Association, which represents more than 4000 businesses employing more than 15,000 people, welcomed the proposed amendment to the Interactive Gambling Bill, saying the news came as a “relief”.

“We are pleased to see this loophole being addressed on a national level,” ALNA chief executive Adam Joy said in a statement.

“The best kind of consumer protection from synthetic lotteries is to not allow it in our country. The model encourages problem gambling, promotes high-risk spending, and is misleading regarding the winnings available.

“And it also comes at a significant cost to state taxes, and to local family-run small businesses — that employ locally, pay Australian taxes and support the local community.”

Mr Joy said websites like Lottoland “send bets overseas and have a history of being misleading, preferring token gestures over responsible behaviour, of targeting Australian businesses, of illegally misusing trademarks of other businesses and facing legal action”.

“And they do all this while operating outside of the much tighter regulations, consumer protections, and higher taxes that official regulated lotteries adhere to,” he said.

Mr Joy said lotto betting websites employed the same features as poker machines making them “high risk and dangerous”, while using the “low-harm product of lotteries as the bait to then switch Australian consumers”.

“The Federal Interactive Gambling Act already makes it illegal to sell a scratchy online and play a poker machine online, and the federal government moved last year to further strengthen the act with an amendment to ban online in-play betting on sports and banning credit betting, as well as making it illegal for unlicensed operators to offer online poker,” he said.

“We are pleased that they are now closing a further loophole in the Act by banning online betting on all lottery and keno outcomes.”

In a statement, Lottoland Australia CEO Luke Brill said, “While we understand the concerns expressed by some newsagents, the proposed legislation is both misguided and unnecessary.

“The fact is that Lottoland does not offer betting opportunities on any Australian lottery, so our offering does not have a direct impact on newsagents.

“On the contrary, we want to work with newsagents to provide customers with greater choice and even better services, which have the potential to be highly beneficial for individual newsagents.

“As a responsible and responsive corporate citizen that contributes extensively to local and community groups, we will continue to work closely with regulators and all political parties to reach a satisfactory outcome in the best interest of our more than 650,000 registered customers.”

frank.chung@news.com.au