Online Gambling in China: A Good or Bad Idea In 2012?

At the beginning of the year, we posted a poll on which market did you think had the most potential in 2012, and surprisingly China got the most votes in it. In this article, we aim to discuss the status of China as a profitable and open online gambling market so that affiliates can evaluate if they want to do business there this year.
China is a country famous for their legendary gambling tradition; the Chinese are the creators of many online casino games and have been the masters of several gambling techniques for centuries. Keno and Pai Gow are two games that were created in China with the purpose of bringing revenue to the state at times of war.
Currently, the law dictates that there is no gambling, online or off-line, in China as the activity is deemed unlawful and highly criminal. However, statistics show that the Chinese gambling industry generates $4 billion every year. Naturally, you are wondering how this is possible, so let us tell you.
The Legal Status of Gambling in China
Chinese law allows a state-owned and operated lottery to run in the country, but other than that it bans all forms of gambling. The state lottery is prohibited from offering services online due to unscrupulous false websites that ripped off Chinese citizens by selling fake lottery tickets.
Gambling is a traditional practice in China and everyone in the country knows that the citizens like to gamble, and in order to do so they have to find a place where they can do it legally: Macau. The Chinese government doesn’t engage in legislating online gambling in Macau nor does it put a lot of effort in intervening in what goes on there, however, it has made it harder and harder for the Chinese to obtain visas to go there.
The Chinese government is not so concerned with preventing their people from gambling, but their concern lies in the activity turning into means for profit as opposed to entertainment. Many times, the government has closed backstreet casinos and illegal gambling venues, but always making it clear that they do not condemn friendly home games and traditional play.

What to Expect?
Currently, Chinese gamblers continue to break the law every time they play at a casino (online or offline), but everything suggests that gambling is an acceptable activity in China and it is only illegal to run live gambling venues open to the general public.
The fast economic growth that China has experienced in the past decade has left the country with many more wealthy citizens who like to gamble. Everyone believes that China is about to open up to online gambling and that the government will regulate the activity in an attempt to gather revenue for the state.
All of those are positive things, but it is important to keep in mind that the Chinese government is yet to take action on regulating the online gambling market and that the Chinese authorities haven’t said anything clear on the matter. Also, Chinese citizens who have been found guilty of gambling at live and online casinos have been arrested in the past and this would not change unless legislation changes.
As a final note, it is important to remember that the Chinese see gambling as a traditional activity and perhaps will see off shore companies as offensive to their culture and unnecessary and go for a state gambling monopoly.
All in all, China is a market with long-term potential if the government steps away from traditional beliefs and opens the market to foreign investors. Will this happen? I guess we will see if it does this year.
What do you think of doing business in China? Are you interested in entering the Chinese online gambling market? Please let us know what you think so we can provide you with more tools and guidance in the right direction.