The NSW government is preparing to restrict the operation of so-called synthetic lotteries such as foreign online betting agency Lottoland.
Racing Minister Paul Toole says synthetic lottery operators may be breaching existing wagering legislation.
"Payment of winnings may rely on complex commercial arrangements between the operator and its insurer," he said in a statement Thursday.
"The NSW government is currently considering options to restrict betting on these lotteries."
Deputy Premier John Barilaro says the government has serious concerns about the products.
"Many customers buy tickets in a synthetic lottery, believing they're entering a lottery, when in fact they are instead betting on the outcome of that lottery," he said.
Newsagencies and lottery operators have been campaigning against Lottoland,. which also sponsors the NRL's Manly Sea Eagles.
The agency is headquartered in the British territory of Gibraltar and offers bets on the results of more than 30 different lottery draws.
It allows people to bet on big international lotteries, such as Spain's El Gordo and US MegaMillions, which offer enormous prizes.
