A funded class action lawsuit has been filed against the SkyCity Entertainment Group, challenging the legality of its online operations in Malta.
In a statement to investors, SkyCity noted that the proceedings have been initiated against the company itself, SkyCity Auckland Holdings Limited, and the Maltese firm Silvereye Entertainment Limited.
The lawsuit aims to “test the lawfulness of online operations carried out by Silvereye on behalf of SkyCity’s overseas subsidiary (SkyCity Online)”.
The funded class action seeks to reclaim gambling funds lost to SkyCity Online between February 2020 and February 2026. In its statement, the operator emphasized: “SkyCity denies any liability and intends to actively defend the proceedings.”
Previously, an outdated Gambling Act contributed to the growth of the “grey market” in New Zealand, allowing players to access overseas online casinos but not domestic ones. SkyCity appears to have taken advantage of this, using its Maltese subsidiary to maximise potential revenue.
Licensed by the Malta Gaming Authority, SkyCity Online is a New Zealand online casino operated by Silvereye, a subsidiary of Gaming Innovation Group (GiG). The online casino operates on behalf of SkyCity Malta Limited, a subsidiary of SkyCity.
Graeme Stephens, the company’s Chief Executive Officer at the time of the launch in 2019, stated: “Online casinos are widely used by New Zealand customers and this trend will only continue. The world is rapidly moving online and our industry is no exception, so we have to ensure we remain relevant to changing consumer trends and preferences.”
The government has acknowledged the grey market issue and begun establishing a regulatory framework for online casinos.
During the second reading of the New Zealand Online Casino Bill, its primary objective was clearly outlined by Paul James, Secretary of Internal Affairs and Chief Executive of the Department of Internal Affairs.
Speaking at the Regulating the Game conference in Sydney, James emphasized that the bill aims to bring online casinos out of the “grey” market into a regulated and legal framework.
According to Inside Asian Gaming, he noted that online casinos are already deeply embedded in the daily lives of New Zealanders but often operate without proper safeguards.
James explained that the goal is not to introduce online gambling, but to legalize existing operations by establishing a regulatory framework and ensuring compliance with safety standards.
He added: “We’re really trying to strike a balance here between measures that effectively detect and prevent and minimise harm, while also ensuring the settings are not so restrictive that the gambling operators can operate effectively, and that New Zealanders feel confident in making those choices in participating with our non-extended gamblers.
“Getting the balance wrong will mean that people will opt into the black money and New Zealanders will gamble without any support or protection.”
Up to 15 online casino licences will be auctioned in New Zealand as part of a three-stage licensing process. The market is expected to launch on 1 December this year.
SkyCity is one of two known operators interested in obtaining a licence. CEO Jason Walbridge said: “Gaming is evolving in exciting ways, bringing together the best of in‑person and digital experiences.
“While we aim to lead this change, our priority is ensuring our customers and communities are protected. Any move into a regulated online market would be built on strong consumer safeguards and SkyCity’s enduring commitment to responsible gambling, so the experience remains safe and enjoyable for everyone.”
The other operator seeking licences is Entain Australia & New Zealand. Group CEO Stella David noted during a recent earnings presentation that the company plans to pursue three licences in the market.
The SkyCity case could reignite debate over whether Malta has a legal shield when issuing gambling licences for overseas markets.
This issue has come to the forefront amid an escalating legal dispute between Austria and Malta concerning player protections and the impact of Maltese licences.
Malta is challenging European court rulings on the reclaiming of player losses, citing Article 56A of the Maltese Gaming Act to defend its national legislation.
Christian Rapani, founder of Rapani Rechtsanwälte GmbH, recently discussed the dispute between Malta and European nations, as well as recent developments in the case.
He said: “This confrontation has introduced momentum,” he reflected. “Sometimes legal disputes that escalate create the necessary pressure for political discussion. It may be uncomfortable in the short term, but it forces stakeholders to confront structural inconsistencies that have existed for many years.”
“You have a highly regulated industry operating in a borderless digital environment.
“But unlike banking or insurance, gambling law is not harmonised at the EU level. That creates friction. National sovereignty remains strong, but digital services do not respect borders. Reconciling those two realities is the long-term challenge.”
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