SkyCity Faces Funded Class Action Over Online Casino Lawfulness

SkyCity Entertainment Group has received notice of legal proceedings against the company, SkyCity Auckland Holdings Limited, and Silvereye Entertainment Limited, with an application lodged for leave to bring a funded class action over gambling losses incurred on SkyCity Online between February 2020 and February 2026.

What the Proceedings Allege

The proceedings seek to test the lawfulness of the online gaming operations run by Silvereye on behalf of SkyCity Malta, an independently operated overseas subsidiary of the SkyCity Entertainment Group. The claim centres on whether SkyCity’s structure, using a Malta Gaming Authority-licensed entity to serve New Zealand-resident players, was a legally permissible arrangement under New Zealand law.

New Zealand’s Gambling Act 2003 prohibits domestic operators from offering online casino services. It does not, however, prevent New Zealand residents from accessing offshore platforms, a loophole SkyCity moved to exploit in 2019 when it launched SkyCity Online Casino. The company believed the Malta structure, operated within a regulated framework and applying New Zealand host responsibility rules, would comply with local law. The class action is a direct challenge to that interpretation.

Local media has reported the proceedings are funded by an unnamed US entity, though neither SkyCity nor the filer has confirmed the identity of the party behind the action.

The Role of GiG and Silvereye

SkyCity Online Casino was developed and operates on a platform built by Gaming Innovation Group (GiG). Silvereye Entertainment Limited, a Malta-based GiG subsidiary, holds the MGA licence and acts as the principal entity transacting with online casino customers. According to SkyCity’s most recent half-year report, revenue from the online operations is reported net of costs payable to GiG under its contractual arrangements, with GiG recognised as the transacting party rather than SkyCity itself.

SkyCity divested its equity stake in GiG in June 2024 but retained the commercial relationship through SkyCity Online. GiG reported 31% revenue growth in Q3 2025, with its B2C operations, of which SkyCity Online forms a part, remaining a notable contributor to group performance.

In the six months to 31 December 2025, SkyCity reported NZ$1.6 million in online gaming revenue, down from NZ$2.1 million in the prior comparable period. Overall group revenues fell 2.4% to NZ$411.7 million across the same half-year.

SkyCity’s Position

SkyCity stated it “denies any such liability and will actively defend the proceedings.” The company said it is still reviewing the legal action and declined to comment further. GiG had not responded to media requests for comment at time of publication.

The proceedings name three entities: SkyCity Entertainment Group, SkyCity Auckland Holdings Limited, and Silvereye Entertainment Limited. The inclusion of Silvereye as a named respondent is significant given its role as the MGA licence holder and formal transacting party, drawing GiG’s subsidiary directly into the legal dispute regardless of SkyCity’s own corporate distancing from the day-to-day platform operation.

Timing and Regulatory Context

The proceedings land at a moment of significant regulatory transition for New Zealand’s online gambling market. The government is in the process of establishing a regulated domestic iGaming framework, with a licensing round for up to 15 online casino operators expected to open in July 2026. New Zealand’s move to issue online casino licences has run alongside a broader tightening of gambling regulation, including a decision in February 2026 to declare prediction market products illegal under the Gambling Act.

Operators already serving the New Zealand market through offshore structures are expected to apply for local licences once the process opens and will be permitted to continue operating until their applications are determined. Whether a successful class action outcome could affect SkyCity’s standing in that process, or its operational position before it, remains an open question the proceedings will ultimately force into view.

The funded class action model itself carries structural implications for SkyCity’s exposure. If the court grants leave for the proceedings to proceed on a class basis, the potential pool of claimants extends to every New Zealand player who lost money on the platform in the six-year window from February 2020 to February 2026, a scope that could substantially exceed the online operation’s reported revenues across that period.

Source: SkyCity Entertainment Group