Japan: proposal to revise soccer betting lottery law

On 26 February 2013, the Liberal Democrat Party (LDP), the current ruling party in Japan, agreed to submit a bill to revise Japan’s Soccer Betting Lottery Law. The revision will expand the current system so that English Premier League matches and matches played during the World Cup can be bet on in Japan.

The aim of the bill is to raise funds in order to renovate the National Stadium of Japan as Japan bids for the 2020 Olympic Games. Currently, there is no consensus regarding who will bear the costs for the needed renovations and agencies continue to debate the issue. The intent is to submit the bill during the current Diet session, which ends in June, and have it approved with support from the LDP, New Komeito Party and the Democratic Party of Japan.

Gambling in Japan is, with few exceptions, strictly prohibited. Currently, gambling is limited to horseracing, speedboat racing, bicycle racing, motorcycle racing and two government sanctioned lotteries – a government-run lottery (called takara-kuji) and a soccer betting lottery (called toto, from the Italian word totocalcio). Private bookmakers for sports gambling, both online and offline, are prohibited.

Under the current toto system, betting is permitted only on certain Japanese domestic soccer matches in the J-League. The revision to the law will allow betting on UK Premier League matches and FIFA World Cup matches that will involve famous Japanese players. It is estimated that allowing these bets will increase the handle from about 80 billion yen a year to around ¥110 billion a year.

There are several ways to bet on soccer in Japan. The toto system is a hybrid parlay/lottery system. The first type of game, called BIG, does not allow betters to specify winners and losers. BIG is more like a straight lottery. In BIG, several soccer matches are grouped together. A computer selects winners, losers or draws for each match. A bettor needs to have a certain number of games chosen correctly in order to win.

Under the toto system, there are three other different games that are similar to a combination of parlay bets and a lottery. Betters can choose some winners, losers or draws (or they can do so for all the games on the card) or make selections only for some games and allow the computer to predict the rest of the games. In one type of game, bettors need to predict the score of each game on the card (but there are only three games on these cards during regular season and two during certain tournaments). If no bettor wins all the matches, a portion of the handle is carried over.

While it is clear that the draft bill will allow betting on U.K. Premier League matches and FIFA World Cup matches, how it will be implemented and how bets will be placed is not yet decided. It is anticipated that the change will increase the maximum payoff to winners from ¥100 million (US$1.1 million) to ¥250 million (US$2.7 million) and increase the maximum carried-over handle amount from ¥600 million (US$.5 million) to ¥1.5 billion (US$16.3 million).

Given the recent match-fixing scandals, only bets on UK Premier League matches and FIFA World Cup matches will be permitted. In addition, it is likely that at least three offshore matches will need to be involved in bets to help limit the risks associated with match fixing.

According to reports, if the amendment passes, bets on overseas matches could start by the end of this year.