Although not perceived as gambling from most customers and jurisdictions, some countries, Finland for instance, have deemed this form of auctions as a lottery.
In a 2008 report to the UK Gambling Commission, Dr Mark Griffiths, Professor of Gambling Studies at the University of Nottingham, has stated that “..Penny Auctions are similar to lotteries and the UK’s Gambling Commission should investigate whether they should come under regulatory jurisdiction.”
However, the Commission said that it is not convinced that penny auction sites constitute gambling, but said that it will monitor developments in the area.
In the USA, the Delaware State made a ruling in September 2009, that Penny Auction sites do not break the U.S. Code of Gambling and that they are not to be considered as gambling sites. They neither promotes nor pursues illegal gambling, and does not fit in the definition of illegal gambling business, as defined by the U.S. Code.
The same goes for the Swedish Lottery Inspection, “Lotteriinspektionen”, who have decided not to rule Penny Auctions as gambling or a lottery.
Auctionbringer have however decided to host and operate under a gambling license from the Netherlands Antilles. This is for 3 primary reasons:
We also want to offer Casino games for our customers. For this, a license is required; and
To satisfy not only current, but also future, legislation we have decided that acting under a gambling license is the right way forward. Auctionbringer is the world’s first licensed Penny Auction provider.
Since we operate as a gambling company under the laws of the Netherlands Antilles, we do not have to pay VAT on the bid packages.
It is worth noting though that it is our belief that the game format Penny Auctions is not a lottery game or gambling, but rather an entertaining and exciting twist of traditional auctions. However, for pragmatic reasons and to satisfy current and future legislation, we have decided to operate under a gambling license issued by the Netherlands Antilles.
Gambling or not?
Although not perceived as gambling from most customers and jurisdictions, some countries, Finland for instance, have deemed this form of auctions as a lottery.
In a 2008 report to the UK Gambling Commission, Dr Mark Griffiths, Professor of Gambling Studies at the University of Nottingham, has stated that “..Penny Auctions are similar to lotteries and the UK’s Gambling Commission should investigate whether they should come under regulatory jurisdiction.”
However, the Commission said that it is not convinced that penny auction sites constitute gambling, but said that it will monitor developments in the area.
In the USA, the Delaware State made a ruling in September 2009, that Penny Auction sites do not break the U.S. Code of Gambling and that they are not to be considered as gambling sites. They neither promotes nor pursues illegal gambling, and does not fit in the definition of illegal gambling business, as defined by the U.S. Code.
The same goes for the Swedish Lottery Inspection, “Lotteriinspektionen”, who have decided not to rule Penny Auctions as gambling or a lottery.
Auctionbringer have however decided to host and operate under a gambling license from the Netherlands Antilles. This is for 3 primary reasons:
It is worth noting though that it is our belief that the game format Penny Auctions is not a lottery game or gambling, but rather an entertaining and exciting twist of traditional auctions. However, for pragmatic reasons and to satisfy current and future legislation, we have decided to operate under a gambling license issued by the Netherlands Antilles.
Read more about our jurisdiction and license here >>.