A Full Look at Gambling in Taiwan

Taiwanese betting laws are very strict. It is only legal to bet approved lotteries and the sports lottery. Because neither offers good odds online betting in Taiwan is very popular. Also, even at risk of harsh penalty, gambling Mahjong is a Taiwanese obsession. Many people also enjoy sports betting, wagering Chinese chess and playing real money poker. For casino, trips for the purpose of gambling in Macau are routine. According Macau government tourism figures, in 2012 Macau had 1,072,052 visitor arrivals from Taiwan. This is a huge number considering our population is under 24 million, and shows how much Taiwanese love to gamble.

In this article I discuss Taiwan gambling law, its history, and our legal forms of betting. While OnlineBetting.com does not advocate breaking the law, I provided the link to betting online because this is gambling and gambling involves risk. We’re all adults who are free to decide what risks we take. In this article here I cover the penalties for unlawful gambling and discuss the fully legal to use options.

Taiwan Gambling Laws

As covered in my article on Chinese Mainland Gambling Laws, the gambling laws of Taiwan are the same as the KMT government created in 1928 while still ruling mainland China. Compared to gambling laws worldwide, the laws here are very easy to understand. Chapter 21 of the Taiwan Criminal Code has only five short articles (266-270) that cover the penalties for unlawful gambling. The fines are all in Chinese yaun and at the time of this article 1 yuan is 4.62 Taiwan New Dollars (TWD).

The penalty for social gambling in public is a fine up to 1000 yuan and any cash found at the premises is confiscated by the police. The law does state that gambling on social occasion is okay. This has been interpreted to mean social wagers between friends conducted on rare occasion. If you are hosting gambling games in your home, or wagering for high stakes, you can be charged under Article 268 which is a fine of 3000 yuan and up to 3-years in prison.

The penalty for gambling as a source of profession (as a player) is up to 2-years in prison. The penalties for involvement in illegal lottery are even stricter. For agents this is 6-months in prison. For those running a lottery competing with the legal Taiwan lottery there is no maximum prison sentence, meaning the court can sentence for as long as they would like and as they see fit.

History of Legal Gambling

Legal gambling existed in China at various times in history. As far as Taiwan laws are concerned, Japanese gambling laws came into effect here when in June of 1906 the Governor-General approved Decree No. 7 (The Issuance of Lottery Tickets). As a reminder Taiwan was occupied by Japan from 1895-1945. This lottery they brought was to fiancé various charities and temples. These cost ¥0.50 apiece and first prize was ¥50,000 (this was about 165 times the annual salary of a teacher).

After World War II, our Nationalist government issued the Patriotic Bond Statute. This created a legal lottery for the purpose of encouraging nationalism, balancing the budget and stabilizing the monetary system. The tickets all had anti-communist slogans on them. The first draw was held on 11 April 1950 and tickets costs NT$15 each for a chance at the NT$200,000 prize.

In 1950, rice cost $0.50 per kilo. The price per ticket was too expensive and sales for the first draw were small. For the second draw on, the price was lowered to NT$5 and the prize remained the same. In 1971 the price was raised to NT$10 per ticket. After 1,169 draws the Patriot Lottery was suspended in 1987, the same year Martial law was repealed. This sent us into a period where no gambling was legal in Taiwan except the Uniform Invoice Lottery.

Uniform Invoice Lottery

Effective 1 January 1951, the Kuomingtang (KMT) government created the Uniform Invoice Lottery to boost tax revenues. This encouraged those shopping at stores with monthly turnover of NT$200,000 (USD $6,200) and above to obtain a receipt. These receipts are used in a lottery draw and this ensures the government has sales records for each business. In its first year the invoice-lottery increased tax revenue by 75%.

Still running today the Uniform Invoice Lottery is the oldest lottery in Taiwan. Today, it is managed by the Ministry of Finance and draws are held on the 25th day of all odd numbered months. 3% of taxes collected finance this and there are multiple prizes to be won. There are 4 sets of numbers drawn (0-9 per slot with 8 slots). One is called the special draw where exact match of all 8 numbers wins 10 million Taiwan New Dollars ($342,000 US). The others award NT$200,000 for getting all correct. One of these numbers is used for awarding smaller prizes. Last 7 correct pays NT$40,000, Last 6: NT$10,000, Last 5: NT$4,000, Last 4: NT$1,000 and last 3: NT$200.

This exciting lottery generates much discussion on Taiwanese forums and facebook. Television shows and entertainment are built around each draw. In case you miss a draw, official results are published online.

Legal Lottery Returns to Taiwan

After the Patriot Bond Lottery was suspended in 1987, illegal lottery became rampant. Even with a legal replacement available, many Taiwanese still call their bookies to bet on legal Hong Kong gambling such as the Mark Six lotto. In an attempt to gain control over illegal gambling we began allowing local governments to run their own lotteries. On 5 June 1995 the government issued the Public Welfare Lottery Issue Act to regulate it. This has been amended many times and that link is to the current copy.

In 2002, the government took back control of the lottery awarding its contract to Taipei Bank (since renamed Fubon Bank). This contract expired and effective January 1, 2007 Chinatrust Commercial Bank (CTBC) took over. They run all forms of lottery in Taiwan except the Uniform Invoice Lottery already mentioned and the Taiwan Sports Lottery, mentioned next in this article.

The legal lotteries operating here are many. Super Lotto (威力彩) drawn Monday and Thursday and
Lotto 6/49 (6/49大樂透 ) drawn Tuesdays and Fridays are our richest lotteries. We also have daily numbers, keno, scratch cards, a game similar to tic-tac-toe, traditional Chinese lotto and more. To learn about this refer to my article How to Play Taiwan Lottery. This covers all the details of every game offered by our lottery company.

Taiwan Sports Lottery

Taiwan Sports lottery launched in May 2008 and is the only source for legally betting sports in Taiwan. There are locations on virtually every corner of populated cities, as well as terminals and online betting via BetIWin.

The major leagues covered are MLB baseball and NBA basketball from the United States and the major European football (soccer) leagues. It is also possible to bet Asian baseball and on occasion tennis, golf, and the Olympics have been offered.

The legal basis for Taiwan Sports Lottery is the Sports Lottery Issuance Act. Taipei Fubon Bank was awarded contract to be the exclusive operator of this lottery until July 31, 2014. In their first four years of operation they lost NT$4.7 billion (US$161.8 million) and did not bid to renew their contract.

A major reason for the losses is the contract to operate. This required achieving 80% of the sales volume the regulators had predicted at the onset. Failure to meet this meant the operator had to cover the difference in tax and charitable contributions. After sales came in at only 56% of projections, Fubon sought relief with the tax authority and in court. They were unsuccessful after many appeals. Details of the contract and results are discussed in the Fubon Financial Holdings 2012 Annual Report.

The reason for low sales largely relates to how the sports lottery works. There are multiple games each with unique wagering options. Some games are pari-mutuel based. For example in Da San Yuan bettors pick the result of three baseball matches and part of the pool goes to all correct and part goes to those with two winners. In Da Si Xi four soccer matches are bet and the pool goes to those with all correct. For this form of betting, only 75% of sales go into the pool.

When it comes to fixed odd betting the odds are very poor. At best, you can find basketball handicaps at European odds 1.77 (-130 American) per side. This gives the lottery a theoretic hold of 11.5% per bet. For NBA basketball these must be wagered in 6-fold accumulators (6-team parlays) or greater. With a 6-teamer on the handicap the true chances of winning are 1 in 64. The sports lottery pays only 29.67 to 1.

The challenge with these odds mentioned is well before sports lottery existed illegal betting was very popular in Taiwan. Reputable companies from the United Kingdom such as www.bet365.com support Taiwanese language and currency. Though this is violation of Taiwanese law, they are not in Taiwan and are legal and licensed in Europe. Simply put our authorities have no jurisdiction over them. There are also many illegal bookies here too. Due to better odds the same 6-team wager on NBA handicaps pays 47.41 to 1 at Bet365 as compared to 29.67 to 1 at Taiwan Sports Lottery. The fact sports lottery is legal has not been enough of a sell to get those already betting online and with bookies to make the switch.

Though the competition from illegal bookies is most to blame, not helping sales is the fact there was a major Taiwan Sports Lottery scandal in 2011. An employee was able to open the system after match results were known and place winning bets. For pari-mutuel betting this lowered the dividends paid to legitimate winners. Fubon took major financial and PR hits while operating this lottery and their share prices have declined.

The good news is much reform is likely on the way. Players affected by the scam have been paid, the perpetrators placed in prison, and new harsher laws have been passed to increase the penalty should this occur again. Also, a very experienced company is taking over in 2014.

Effective August 1, 2014 (if not sooner) the Taiwan Sports Lottery exclusive contract (this time 10-years) changes hands. It has been awarded to the Taiwanese manufacturer of DRAM modules and flash-memory products Adata Technology Co. They will operate it in partnership with successful Greek lottery company Intralot and Chinatrust Commercial Bank (CTCB) who runs our legal non-sports lottery games. This group is vowing to turn the sports lottery profitable. To do so they will need to attract more sales which should mean government lobby leading to better wagering options for players in the coming years.

Casinos in Taiwan

Taiwan has never had any legal casinos but this could change. Back in January 2009 the Offshore Islands Development Act was amended. Article 10 added a provision where our offshore Islands can legalise casino gambling to increase tourism. To do so a local referendum must be passed.

After numerous failures with locals voting no, in July 2012 Matsu finally approved a casino with a 57% yes vote. The government has been very slow in drafting the legislation and it is not expected any progress will be made until summer 2013. After this a casino resort will take some time to build so it could be a while.

For now the only easy legal option is travel. There are many forms legal gambling in Macau including casinos. Taiwanese passport holders are stamped in for 30-days with no visa required.