Harris Hagan

28Apr

Gambling Commission Advice to Government

28th April 2023 Harris Hagan 273

The Gambling Commission has published its advice to Government (the “Advice”), as part of the review of the Gambling Act 2005 terms of reference and call for evidence, providing advice on each of the following topics:

effectiveness of the regulatory system;
online protections, players and products;
safer gambling and public health messaging;
advertising, marketing and sponsorship;
the Commission’s powers and resources;
wider funding for research, prevention and treatment;
consumer redress;
age limits and verification;
protections for young adults; and
land-based gambling.

In the Introduction, the Gambling Commission explains:

“In forming our advice, we have considered the widest range of evidence and applied a rigorous, consistent, and transparent evidence assurance process. The evidence assurance process enabled us to determine the strength of the evidence base and the weight that could be applied to the formulation of our recommendations. Where there was a lack of conclusive evidence, we took the position that this did not automatically mean that conclusions could not be reached or that action should not be taken. In some of our recommendations we have applied the precautionary principle where the potential for harm existed. We have, however, been transparent in our advice where we are advocating a precautionary approach.”

Andrew Rhodes, Gambling Commission CEO, said:

“The gambling industry has changed significantly since 2005 and our advice sets out changes that will ensure Britain is the safest and fairest place to gamble in the world. The review is a once-in-a-generation opportunity to deliver positive change for gambling in Great Britain and for all people impacted by it. Everyone at the Commission welcomes today’s publication of the White Paper and is determined to work with Government and partners to make these changes a reality. Given the correct powers and resources, the Gambling Commission can continue to make gambling safer, fairer and crime free. This White Paper is a coherent package of proposals which we believe can significantly support and protect consumers, and improve overall standards in the industry. As the detailed implementation of the review now begins, we will also be reiterating to all operators that the Commission will strongly maintain its focus on consumer protection and compliance.”

The Advice was published very shortly after the long-awaited publication of the Gambling White Paper on 27 April 2023.

We will review the Advice in detail and will be publishing our insights over the coming weeks and months.

Download the Advice to Government

27Apr

Long-Awaited Gambling White Paper Published

27th April 2023 Harris Hagan 269

The long-awaited High Stakes: Gambling Reform for the Digital Age (the “White Paper”) has been published today, nearly 30 months after the review of the Gambling Act 2005 terms of reference and call for evidence (the “Gambling Review”) was published on 8 December 2020.

The Gambling Review had the following objectives:

Examine whether changes are needed to the system of gambling regulation in Great Britain to reflect changes to the gambling landscape since 2005, particularly due to technological advances;
Ensure there is an appropriate balance between consumer freedoms and choice on the one hand, and prevention of harm to vulnerable groups and wider communities on the other; and
Make sure customers are suitably protected whenever and wherever they are gambling, and that there is an equitable approach to the regulation of the online and the land-based industries.

Six Gambling Ministers, three Prime Ministers, two Monarchs, 16,000 responses, several leaks, a World Cup and a global pandemic later, we welcome the publication of the White Paper which brings at least the beginnings of some certainty and direction to the industry about Government plans to ensure our gambling laws are “fit for the digital age” and on important issues such as affordability, where speculation (often of the worst-case variety) and uncertainty has been casting a long shadow over the future of the industry. It also brings substantial and meaningful reforms intended to make gambling safer, “to protect vulnerable users in smartphone era”. These include the proposed introduction of a mandatory levy on gambling companies (for spending on research, education and treatment of problem gambling), but will undoubtedly not go far enough to meet the expectations of gambling reform campaigners.

In today’s announcement, Culture Secretary Lucy Frazer outlined a comprehensive package of new measures to achieve the Government’s objectives following the Gambling Review, and captured the balance between consumer freedoms and protection of harm in her Ministerial Foreword to the White Paper as follows:

“Millions of us enjoy gambling every year and most suffer no ill effects, so state intervention must be targeted to prevent addictive and harmful gambling. Adults who choose to spend their money on gambling are free to do so, and we should not inhibit the development of a sustainable and properly regulated industry which pays taxes and provides employment to service that demand. What we will not permit is for operators to place commercial objectives ahead of customer wellbeing so that vulnerable people are exploited.”

The White Paper is 268 pages long and has six chapters.

The key proposed reforms are:

A statutory gambling levy to fund treatment services and research, including through the NHS, the rate of which will be subject to further DCMS consultation. The DCMS consultation will consider the differing association of different sectors of the industry with harm and/or their differing fixed costs, and will commence with design and scope in Summer 2023.
New default stake limits for online slots games that will be between £2 and £15 per spin, with greater protections for 18-24 year olds (options of £2 or £4 or based on individual risk), all subject to DCMS consultation in Summer 2023.
The Gambling Commission will consult in Summer 2023 on two forms of financial risk checks. It is proposed that at a £125 net loss within a month or £500 within a year, there will be background checks for financial vulnerability, such as County Court Judgments. It is proposed that at higher levels of spend, engaging proposed thresholds of £1,000 net loss within 24 hours or £2,000 within 90 days, there will be more detailed consideration of a customer’s financial position. It is proposed these triggers will be halved for those aged 18 to 24. The Government estimates that “only about three percent of the highest spending accounts will have more detailed checks”. The intention is that these checks will be “frictionless” with further information only being required from customers as a last resort. Operators will be required to respond appropriately to any identified risks on a case-by-case basis, but “it is not the intent that government or the Gambling Commission should set a blanket rule on how much of their income adults should be able to spend on gambling”.
The Gambling Commission intends to consult on mandating participation in a cross-operator harm prevention system based on data sharing.

Extra powers for the Gambling Commission to enable it to tackle black market operators through court orders and work with internet service providers (ISPs) to take down and block illegal gambling sites. Proposed reform of the fee structure for the Gambling Commission “to give it greater flexibility to respond to any emerging risks and challenges posed by the industry”. The Culture Secretary envisages a “beefed up, better funded and more proactive Gambling Commission”.
Rules to prevent bonus offers from harming vulnerable people – for example, the Gambling Commission will be looking in 2023 at how free bets or spins are constructed and targeted to stop them from being harmful.
A review by the Gambling Commission in Spring/Summer 2023 of online game design rules to look at limiting speed of play and other characteristics which exacerbate risks.
A new industry ombudsman to deal with disputes and rule on redress where a customer suffers losses due to an operator failing in their player protection duties, to be accepting complaints within a year.
A review of the current horserace betting levy to make certain racing continues to thrive.
Casinos of all sizes will be permitted to offer sports betting in addition to other gambling activities.
Government will take steps to reallocate unused 2005 Act casino licences to other local authorities.
Where 1968 Act casinos meet the requirements of a 2005 Act Small casino, including for size and non-gambling space, they will be eligible for the same gaming machine allowance. A single gaming machine-to-table ratio of 5:1 will apply to Large and Small 2005 Act casinos and these larger 1968 Act casinos, and they will be entitled to the same maximum 80 machine allowance as Small casinos. Smaller casinos will benefit from more machines on a pro rata basis commensurate with their size and non-gambling space, subject to the same table-to-machine ratios and other conditions. DCMS to consult in Summer 2023.
Government will legislate, when Parliamentary time allows, so that the small number of high-end casinos operating in the internationally competitive market will be able to offer credit to international visitors who have undergone stringent checks set out by the Gambling Commission.
DCMS will work with the Gambling Commission to develop specific consultation options for cashless payments in the land-based sectors, including the player protections that would be required before the prohibition is removed. Consultation in Summer 2023.
Government will adjust the 80/20 ratio which restricts the balance of Category B and C/D machines in bingo and arcade venues to 50/50, to ensure that businesses can offer customer choice and flexibility while maintaining a balanced offer of gambling products. DCMS consultation in Summer 2023.
Government is supportive of trials of linked gaming machines, where prizes could accrue across a community of machines, in venues other than casinos (where they are already permitted). This is subject to further work to assess the conditions and how to limit gambling harm, and subject to Parliamentary time to legislate.

The White Paper is a Government policy document which sets out proposals for future gambling legislation and regulation. The White Paper does not include a draft Bill, because the proposed reforms (with just a few exceptions) do not require primary legislation. This is consistent with our long-held view that the Government and the Gambling Commission already have wide-ranging and extensive powers under the Gambling Act 2005, that most reforms can therefore be achieved through secondary legislation and regulation, and that the Government has far more important legislative priorities in the present socio-economic climate.

As the previous Gambling Minister, Paul Scully MP, said in his speech to the Betting and Gaming Council on 26 January 2023:

“The White Paper is not the final word on gambling reform. It will be followed by consultations led by both DCMS and the Gambling Commission. I want the industry to stay engaged as policies are refined, finalised, and implemented.”

We urge the industry to heed that imperative. Our initial review suggests that the White Paper is arguably as balanced as the industry could reasonably have expected, with important and overdue liberalisations for the land-based industry, and that it should engage with Government and the Gambling Commission to ensure that the proposed reforms are delivered in a timely, sensible and, critically, workable way. Vigorous engagement will certainly be required in relation to the “affordability” proposals given their importance and complexity. The Government has set out an ambitious timeline for itself and the Gambling Commission in the White Paper and gambling reform campaigners have already made clear their intention to “hold the Government’s feet to the fire to ensure these measures are implemented swiftly”. So perhaps at least one area of consensus will emerge as secondary legislation and regulation is refined, finalised, and implemented, but do not expect many more as the debate about gambling reform intensifies.

We will continue to review the White Paper in more detail and will be publishing our insights “imminently” and reporting on material developments over the coming weeks and months.

Meantime, watch today’s announcement in the House of Commons made by the Culture Secretary, the Rt Hon Lucy Frazer KC MP:

Download the White Paper

05Jul

Lexology – Getting the Deal Through, Gaming 2022

5th July 2022 Harris Hagan 324

As Harris Hagan continues its contribution to the Lexology GTDT Gaming publication, we are pleased to share with our subscribers, complimentary access to the full reference guide which is now available online.

Our Associate, Jessica Wilson, remains the author of the United Kingdom report, which covers a range of British regulatory insights including land-based and remote gambling and quasi-gambling activities, including legal definition; anti-money-laundering regulations; director, officer and owner licensing; passive/institutional ownership; responsible gambling; taxes; advertising; supplier licensing and registration; change of control considerations; and recent trends in the industry.

The reference guide also allows for side-by-side comparisons with other local insights from jurisdictions such as Australia, Brazil, Germany, Hong Kong, Japan, Macau, Nigeria, South Africa and the USA.

We invite you to review the reference guide at your leisure.

15Mar

DCMS consults on significant increases to Gambling Commission fees

15th March 2021 Harris Hagan 312

The Department for Digital, Culture, Media and Sport (“DCMS”) has launched a consultation which proposes significant increases to Gambling Commission fees, which will affect existing licensees and new applicants. The fee hikes are based on recommendations made by the Gambling Commission to Government, and are intended to fund its costs and increase its resources to respond to emerging risks and technologies. It follows considerable concerns about the funding of the Gambling Commission raised in February 2020, by the National Audit Office, in June 2020, by the House of Commons Public Accounts Committee, and in July 2020, by the House of Lords Select Committee on the Social and Economic Impact of the Gambling Industry.

It is worth noting that the Government Call for Evidence, published on 8 December 2020, includes review of the Gambling Commission’s power and resources. To heed off any criticism that the proposed fee increase is premature, the consultation states “the proposals are aimed at ensuring the Gambling Commission is able to meet ongoing challenges while the Review progresses.” It, therefore, does not close the door on further increases!

“Key challenges”

The Gambling Commission identified the following “key challenges” in regulation which are expected to grow in significance in coming years and are used as justification for the proposed increased fees:

Challenge 1: Increased technological developments, including product and payment innovation, requiring:

more specialist staff, including a Chief Product Officer, to understand and translate the impact of technological changes, and other staff with technical and investigative expertise;
investment in tools to improve the Gambling Commission’s approach to compliance; and
development of the Gambling Commission’s approach to making better use of the wealth of data available to it.

Challenge 2: Changes in the size and shape of the market, particularly consolidation by mergers and acquisitions, and globalisation, requiring:

more staff to drive the international regulatory agenda and work with international regulatory partners and agencies;
specialist staff to interrogate and understand complex corporate structures; and
increased legal capacity to defend positions.

Challenge 3: Increasing risks associated with unlicensed operators to protect consumers and the industry from “black market” encroachment, requiring:

more staff to identify, proactively and systematically, the scale of illegal gambling; and
more resources to tackle illegal gambling more robustly, including increased legal capacity for prosecutions.

The inclusion of Challenge 3 is perhaps most surprising given that the Gambling Commission has, for some time, maintained the view that the impact of the black market has been “exaggerated”.

The Gambling Commission acknowledges its proposed responses to these key challenges “are not fixed and will need to evolve over time”.

Annex One of the consultation includes the Gambling Commission’s detailed assessment of these key challenges.

Current funding

The Gambling Commission’s funding comes from its fee income (from application and annual fees), and in recent years, it has been drawing on its reserves which are now running low and will not be able to sustain its operations in the future.

In 2020-2021 the Gambling Commission’s budgeted income was £20.4 million and the latest figures suggest that its actual income will be approximately £700k less due to the impact of Covid-19. Its operating budget is £21.39 million, broken down as follows:

43%	Operational
24%	Policy
12%	Partnerships
11%	Licensing
10%	Gathering Information

Without increased fees, the Gambling Commission expects to see a difference between its income and expenditure of approximately £3 million per year by 2023-24. This is without any additional investment in new work to deal with the challenges set out above which it estimates will cost between £2m and £3m per annum.

Proposed changes

Proposed changes from October 2021:

60% increase to all application fees (both remote and non-remote licences) regardless of the licence type or fee category;
55% increase to annual fees for all remote operating licences (except for lottery and gaming machine technical licences) and all gambling software licences (both remote and non-remote);
the removal of existing 5% discounts on annual fees for combined or multiple licences (both remote and non-remote);
100% increase to the “flat” additional annual fee paid by licensees who hold operating licences authorising multiple RNG-based activities (including “host” licensees);
additional fee bands for society lotteries (remote and non-remote) and external lottery manager licences, increasing annual fees by at least 15%; and
15% increase to annual fees for all gaming machine technical licences

Non-remote annual fees will also be increased, but not until April 2022, as the Gambling Commission and Government appreciate the overwhelming impact Covid-19 has had on the land-based gambling industry, requiring non-remote operators to have been closed for almost all of the last year. When the annual fee increase comes into effect for non-remote licensees, it will be an increase of just 15%, as the Gambling Commission has identified that it is remote B2C operators, gambling software licensees and host licensees which are driving the increased regulatory burden and are responsible for the bulk of the Gambling Commission’s workload and costs.

Application to vary and change of corporate control fees remain unchanged; however, as these fees are usually calculated based on a percentage of a standard licence fee (with the exception of flat-rate fees in specific circumstances), the knock-on effect of the above-mentioned proposed changes will mean that these fees will also significantly increase.

Annex Two of the consultation sets out the proposed new fees for each licence type and fee category.

Consultation questions

There are only five questions that DCMS request feedback on:

1: Do you agree that annual fees should be increased in line with the proposals set out here, in order to enable the Commission to meet the challenges it has identified?

2: Do you agree with the proposals to increase the additional flat fees for licences that combine remote casino, bingo and/or virtual event betting (RNG licences), and the flat fees for those that combine host licences?

3: Do you agree with the proposals to remove the 5% annual fee (and first annual fee) discounts for other types of combined licence, and the 5% annual fee discount where both non-remote and remote licences are held?

4: Do you agree with the proposals to introduce additional fee categories for society lotteries and ELMs that generate (or manage) greater than £10m proceeds per annum?

5: Do you agree with the proposal to increase application fees to better reflect the costs involved in processing applications?

Next steps

We strongly recommend:

Any new operating licence application is submitted urgently (if you are ready!) for two reasons. Firstly, to pay lower application fees. Secondly, if your new licence is granted before October 2021 – which may be tight depending on where you are in the process – to pay lower annual fees.

Existing licensees review their fee categories to ensure they are in the correct fee category before their next annual fee is payable.

The fees consultation closes on 26 March 2021 and we urge you to respond, as one thing is certain: soon you will be paying a lot more for your licence.

You can respond to the consultation by emailing [email protected] copied to [email protected]

30Oct

Harris Hagan retains Band 1 ranking in Chambers and Partners

30th October 2020 Harris Hagan 368

We are delighted to announce that Harris Hagan has been ranked in Band 1 of Chambers and Partners UK for the 18^th consecutive year for gaming in the UK, with Chambers describing us as:

“…world class in all areas of gambling law”.

The firm now has five lawyers individually ranked, with partners Julian Harris and John Hagan retaining their Band 1 rankings, and partner Bahar Alaeddini her Band 2.

Francesca Burnett-Hall, an associate, has received her debut mention as an Associate to Watch, with Hilary Stewart-Jones ranked as a Senior Statesperson.

We received many positive testimonials, including:

“The firm excels in what it does. It is highly skilled, supremely well informed about the sector, always responsive and has a consummate ability to translate regulation into effective advice”

“They are top of the league in their depth of knowledge”

“They are very customer service-oriented, approachable and knowledgeable about the industry”

“Julian Harris has a wealth of experience and is able to guide clients through complex issues…”

John Hagan “is a well-respected lawyer who has a wide reach in the industry. He takes time to ensure that he is engaged across the industry and remains focused on the international legal landscape.”

“Bahar Alaeddini is noted for her adept handling of regulatory matters concerning online and land-based gambling.”

“Francesca Burnett-Hall’s practice spans a broad range of online and land-based gambling matters.”

Hilary Stewart-Jones “is just fantastic – you couldn’t wish for better commercial and practical advice.” “I think very highly of the advice given by her, it is excellent. I appreciate her understanding of everything regulatory.”

We wish to thank our clients and friends of the firm for their continued input and recognition of our work.

14Apr

Gambling Commission Business Plan 2020-2021

14th April 2020 Harris Hagan 384

In the midst of the Coronavirus crisis and national lockdown, the Gambling Commission pushed ahead and published its annual business plan for 2020-2021 on 1 April 2020. Clearly, the business plan was prepared before recent events, but Neil McArthur’s foreword heavily referenced current circumstances, including observing an immediate increase in participation in online gambling.

The Gambling Commission did not shy away from reaffirming its commitment to tackling gambling-related harm and holding operators to account by, “if necessary, using powers to suspend and revoke operating and personal licences”.

The business plan outlined five key priority areas, whilst making it clear that “verything do is centred around making gambling safer, balancing the enjoyment people get from gambling and identifying the risks that gambling can present to consumers and the wider public.” These five priorities are:

1. Protecting the interests of customers

Focusing on new regulatory requirements to make gambling safer, specifically in relation to VIP/high value customers, responsible game and product design and advertising technology. This follows the recent work of the industry working groups, which we wrote about in our blog on 2 April 2020.

The Gambling Commission will also advise the Secretary of State on the Government’s review of the Gambling Act 2005.

2. Preventing gambling harm to consumers and the public

Topping the Gambling Commission’s list is the intention to establish, by Q2, an ‘Experts by Experience’ Advisory Board, which will “ensure that the voice of consumers, particularly those who have experienced harm, fully informs decisions right at the heart of the Commission.” Industry reception to this initiative has been mixed, with Peter Hannibal of GBG describing it as “scary” amid concerns over the potential for a lack of representation from experts whose experience of gambling is positive. John White of BACTA is more welcoming of the initiative, but only if a wide range of players are the experts, not just those who have experienced problems. No details have been published regarding the Board’s constitution.

The Gambling Commission will also publish an evaluation of its actions to reduce the risk of harm to children and young people, and will review the way that it measures participation in, and prevalence of, gambling.

Finally, Neil McArthur mentioned in his foreword the single customer view initiative, which, with the use of technology, will aim to tackle the challenge “where operators currently only have a partial view of a customer’s behaviour.” This follows a two-day event on this subject on 11 and 12 February 2020. Further details are available here.

3. Raising standards in the gambling market

Raising standards by protecting against threats to betting integrity, developing an improved test-house assurance framework, implementing the Fifth Money Laundering Regulations, and delivering industry events and initiatives to raise standards.

It also intends to make online gambling safer by undertaking targeted action to improve standards in the remote gambling sector, which hints at the Gambling Commission shifting its focus in relation to its regulatory investigations and enforcement action.

4. Optimising returns to good causes from lotteries

The current National Lottery licence, held by Camelot UK Lotteries Limited, ends in 2023. A key priority for the Gambling Commission is the fourth National Lottery licence competition and “finding the right operator, who will innovate to engage players and protect them, run the National Lottery with integrity and continue maximising returns to good causes to benefit society.”

5. Improving the way it regulates

We very much welcome the Gambling Commission’s intention to improve accessibility to its:

digital services, such as eServices; and
often painfully slow and inefficient online application system.

How the Gambling Commission expects to achieve this when it is also considering reducing its staff headcount (as reported by the Guardian) is yet to be seen, but we remain hopeful.

It also plans to establish the case for changes to its fees and advise DCMS accordingly (this will no doubt mean increased fees!) and publish clearer documentation on its corporate governance process.

Given the global uncertainty caused by the pandemic, target dates may be subject to change. The Gambling Commission intends to review the position at the end of Q1, and revise the business plan, where necessary.

Nevertheless, the industry has been warned: “Those who fail to meet expectations will find approach to enforcement getting even tougher than it has been to date.” Given that we have seen the Gambling Commission’s enforcement work (and financial penalties) increase steadily over the last few years, operators would be wise not to view this as an empty threat.

27Mar

Government Help for Gambling Businesses

27th March 2020 Harris Hagan 455

In an effort to help businesses struggling in the face of the global coronavirus pandemic, the Government announced, on 17 March 2020, a business rates holiday for businesses in the retail, leisure and hospitality industries, which is set to last for the next 12 months. However, when the Business Rates Local Authority Guidance was published the following day, it became apparent that the Treasury had specifically excluded casinos, bingo halls and betting shops from the business rate relief by classifying them as financial services.

The Betting and Gaming Council (“BGC”) lobbied the Government in an open letter, advising that its members, which constitute approximately 90% of the betting and gaming industry in the UK, employ over 70,000 people and pay tax of over £3bn, and clearly form part of the UK leisure industry in providing entertainment, food and drink to millions of people every year. Around 64,000 jobs in the betting and gaming industry are at risk following Government-mandated business closures on 20 March 2020, and the cancellation of football matches and horseracing, which has led to a significant reduction in sports betting.

In its letter to the Government, the BGC made clear that:

“If there is no change in the Government’s approach, within months many casinos will be insolvent and we run the very risk that permanent closures of betting shops will occur.
…
Without the kind of help that the Government is rightly prepared to offer other sectors, including in other parts of the hospitality, leisure and entertainment industries, there is a real danger that the physical presence of our industry on the high street, in our towns and cities, will be largely wiped out.
Not only is this a sector which provides a leisure activity enjoyed by millions of people up and down the country, but its closure could lead to a migration of gambling to the black market, which is not only unregulated and an unsafe place for people to bet, but it also contributes nothing to the Exchequer or the country.”

The BGC also suggested other short-term measures which could be introduced to help its members’ businesses survive, including assistance with payroll costs, access to loans and additional time to pay taxes and gaming duties.

Following the BGC’s lobbying, and cross-party support, the Government has now confirmed that the business rates holiday is to be extended to all businesses based in the UK in the retail, leisure and hospitality sector, with casinos, betting shops and bingo halls now forming part of the leisure sector. Businesses do not have to apply for the business rates holiday; it will automatically be applied to their next tax bill.

Additionally, on 20 March 2020, the Government announced its Coronavirus Job Retention Scheme, which is available to every employer in the UK, large or small. Under the scheme, employers who have asked their employees to stop working and have designated them as furloughed workers (and notified them of this change in status) can apply for a grant to cover 80% of their wages, up to a maximum of £2,500 per employee per month, enabling the employees to retain their jobs. This scheme is open for three months, initially, and will be extended if necessary. Details of how to claim through the scheme have now been published.

Further help for small and medium sized enterprises is available via the Government’s Coronavirus Business Interruption Loan Scheme (“CBILS”), under which such businesses will have access to loans, overdrafts, invoice finance and asset finance of up to £5m, with no interest payable by the business for the first 12 months. 40+ accredited lenders offer CBILS, which opened for applications on 23 March 2020 and can be accessed by UK based businesses with an annual turnover of no more than £45million, so long as they meet the British Business Bank eligibility criteria. Further details of CBILS are available here.

Larger businesses can seek help through the HM Treasury and Bank of England Covid Corporate Financing Facility (“CCFF”) which will buy the company’s short-term debt in the form of commercial paper. An explanation of CCFF and its eligibility criteria are available here.

Finally, businesses which pay UK tax and have outstanding tax liabilities may also be able to receive support with their tax affairs via HMRC’s Time to Pay service which has a dedicated telephone helpline on 0800 0159 559.

Further details are available on the BGC’s designated webpage on COVID19.

21Feb

Four Lawyers Ranked in Chambers Global 2020

21st February 2020 Harris Hagan 499

Four of Harris Hagan’s lawyers were individually ranked in the global rankings, for Gaming & Gambling, of the prestigious Chambers & Partners legal directory. For the second year in a row, we are the only law firm, in the world, to have four lawyers recognised in Chambers Global 2020.

Julian Harris was ranked Band 1 and recognised as one of the leading gaming specialists in the UK and a major name in international gaming circles, with peers commenting on his “great reputation” and his “very big standing in the industry.”

John Hagan was also ranked Band 1 and recognised for his “excellent reputation in the industry,” and others saying: “He is at the top of his game.”

Bahar Alaeddini was ranked Band 3 (previously, Up and Coming) with one source enthusing “she is really good because she’s very efficient and well established.”

Hilary Stewart-Jones was ranked Band 2 and recognised as an “excellent lawyer” and for her deep knowledge and long-established commitment to online gaming.

We always strive for high standards in our exciting and challenging legal specialisation in the never dull gambling industry, and believe we are the market leading law firm. We are delighted that our work and commitment to the gambling industry is recognised by the prestigious legal directories.

05Feb

Changing Mindsets

5th February 2020 Harris Hagan 411

After a marked absence from ICE, Neil McArthur, the CEO of the Gambling Commission, gave a keynote speech at the ICE World Regulatory Briefing, on 3 February 2020, titled “Changing Mindsets”, talking about:

why we need to make gambling safer;
what he sees as the opportunities to make gambling safer and the risks if those opportunities are not taken; and
how he thinks a change of mindset can help – regulators, operators, advisers and suppliers – make gambling safer.

McArthur proclaimed that the gambling industry needed to “be bold”, setting out his case for change and why he considered it to be necessary. With public trust and participation rates declining, he referred to the “wholly unacceptable state of affairs” with 340,000 problem gamblers and 1.6 million at risk (data published by Public Health in 2016), and declared that these numbers needed to “radically reduce”, necessitating a “comprehensive public health response”.

Unlike previous ICE speeches, this speech appeared to be written for the consumption of the Gambling Commission’s critics, rather than its subjects.

One of the focuses of the speech was the Gambling Commission’s view of collaboration and the need to look at “complex problems” from “as many different angles as possible”, including those with direct or indirect “lived experience” of gambling related harm. In response to recent criticism from Carolyn Harris MP, following an earlier speech on collaboration, McArthur addressed the appropriateness of a regulator collaborating with its licensees, clarifying two things: (1) it was not self-regulation; and (2) licensees cannot set or mark their own homework. The fruits of the working groups will be “stress tested” before the next Raising Standards Conference and only the Gambling Commission will decide what regulatory changes should follow in the LCCP or Remote Technical Standards, with advice from the Advisory Board for Safer Gambling, Digital Advisory Panel and insights from people with lived experience of gambling harm.

The other focus of the speech was the effect mindset can have on performance, citing the performance coach Matthew Syed. McArthur highlighted too much emphasis being placed on public relations, not addressing the public health issue, and the need for a change in culture by “disrupt old mindsets…to create positive change for consumers and approach the challenges we face in a different way.” He called upon those at the top to change the tone to achieve tangible outcomes and expressed his preparedness “to work with anyone who shares determination to make rapid, positive changes to protect consumers from harm.”

Although abundantly clear already, McArthur spelt out that only the Gambling Commission will judge whether efforts adequately address harm to consumers and, if not, all options will remain on the table, with the Gambling Commission getting “tougher and tougher”. He stated that “the time to think of this as a competition between ‘poachers’ and ‘gamekeepers’ has gone…We each have a different part to play, but that must be our goal. If that isn’t anyone’s goal they need to leave the industry.”

03Feb

Gambling Commission Consults on Remote Key Equipment Changes

3rd February 2020 Harris Hagan 379

All online gambling businesses providing facilities for gambling have remote gambling equipment, known as “key equipment”. This is recorded in Schedule R of their Gambling Commission remote operating licence.

On 30 January 2020, the Gambling Commission published a consultation on the removal of the variation application and notification requirements in relation to key equipment. The consultation proposes that licence conditions 2.1.1 and 15.2.1(7) of the Licence Conditions and Codes of Practice be removed entirely so that operators will no longer need to notify the Gambling Commission of any changes to key equipment, either by way of a key event or an application to vary.

Currently, if a gambling business wants to relocate their key equipment to a different jurisdiction, they are required under licence condition 2.1.1 to apply to vary their remote operating licence. The key equipment must not be moved until the application has been granted and an amended remote operating licence issued, which can take several weeks. Additionally, where a gambling business moves key equipment within a jurisdiction, this must be reported as a key event under licence condition 15.2.1(7). The Gambling Commission’s rationale was so that it could physically inspect the key equipment; however, it has acknowledged this is rarely needed, particularly as many gambling businesses have moved to the cloud.

The requirements are complex, with most not understanding them, particularly when involving aggregation platforms and other suppliers. In many cases, Schedule Rs have 100s of entries and run to 10s of pages. Also, the requirements are hugely burdensome for operators and suppliers, often causing business disruption needing to wait for determination by the Gambling Commission. They are also burdensome for the Gambling Commission, with the effort required not reflected in the £25 application to vary fee.

Licence condition 2.1.2 will remain in place and will continue to allow the Gambling Commission to access remote equipment and/or request copies of data held on the equipment, which it considers is all it now requires. The consultation closes on 26 March 2020 and it is proposed that the changes should come into effect in July 2020. Responses to the consultation can be submitted here and we strongly recommend all online gambling businesses to respond with support for the Gambling Commission’s proposals.

Harris Hagan

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