18Dec

Bahar Alaeddini named in the top 10 Most Influential Women

18th December 2023 Harris Hagan 211

We are very proud to announce that Partner, Bahar Alaeddini, has been recognised in the top 10 Most Influential Women of 2023 by iGamingBusiness.

The award, now in its sixth year, highlights the outstanding contributions made by women who have not only excelled in their roles, but have also made a difference by influencing change within their workplaces and across the wider industry. This honour recognises Bahar’s continued exceptional impact on the gambling industry since joining Harris Hagan in 2012, and reflects the ethos and diversity of the firm, with 50% of both our partners and lawyers being female.

Bahar advises many of the world’s largest online and land-based gambling companies, regulators, financial institutions, and private equity firms on gambling law and regulation. Bahar is at the forefront of thought leadership in the gambling sector, sharing her extensive experience and insight by authoring many articles on a wide range of topics, including acting as the editor of the Chambers Global Practice Guide on Gaming Law. Bahar was named earlier this year as an Emerging Leader of Gaming 40 under 40 and is General Counsel of the International Association of Gaming Advisors and top-ranked in Chambers UK and The Legal 500.

29Nov

Chambers Gaming Law 2023 Global Practice Guide

29th November 2023 Harris Hagan 211

We are pleased to announce that Bahar Alaeddini has reprised her role as Contributing Editor to the Chambers Global Practice Guide for Gaming Law 2023, and Jessica Wilson has again contributed as a co-author. The latest edition of the Gaming Law 2023 guide is now live and describes the licensing and regulatory regimes in 35 jurisdictions, including many of the major global jurisdictions.

In a year that saw a number of significant developments and regulatory updates in the UK and abroad, Gaming Law 2023 is a helpful guide to lawyers, gambling businesses and others in the industry. It provides the latest legal information on a range of topics, including: land-based and online gambling; B2C and B2B licences; application requirements; affiliates; white labels; responsible gambling; AML legislation; restrictions on advertising; acquisitions and changes of control; trends in social gaming, esports, fantasy sports and blockchain; and taxation.

Harris Hagan contributed to the following parts of the publication:

Key trends are covered by jurisdiction under the Trends and Developments section, and the practice guide also provides users with the opportunity to perform jurisdiction comparisons using the Compare locations tool.

Please use the above links to review our contributions and use the practice guide.

27Nov

The Legal 500 Country Comparative Guide 2023 – Gambling Law

27th November 2023 Harris Hagan 188

In its second year of publication, Partner Bahar Alaeddini and Associate Francesca-Burnett Hall have jointly contributed to the UK chapter of The Legal 500: Gambling Law Comparative Guide 2^nd Edition (the “Guide”), with Bahar once again acting as contributing editor.

UK-Chapter Download

The publication – which this year spans 19 jurisdictions – gives readers an overview of gambling law, regulatory and licensing requirements in various jurisdictions and the UK, on matters including:

key gambling legislation and the legal definition of gambling;
types of gambling licences available, with a headline of the application procedures;
prohibited gambling products;
information on gambling advertising and marketing affiliates;
penalties for unlawful gambling;
anti-money laundering and safer gambling requirements;
shareholder reporting and approval thresholds; and
the regulator’s enforcement and sanction powers.

Of particular interest in this year’s edition of the Guide are the key regulatory developments and proposals for reform expected over the next 12-24 months, including those set out in the White Paper, which we outline in the UK chapter.

You can read the Guide and compare jurisdictions here.

19Oct

Gambling Commission publishes response to consultation on changes to the LCCP

19th October 2023 Adam Russell 206

On 17 October 2023, the Gambling Commission published a response to their consultation which proposed changes to the Licence conditions and codes of practice (“LCCP”) in relation to: (1) the scope of the requirement for gambling operators to participate in GAMSTOP; (2) events explicitly listed by the Gambling Commission as “reportable” in the LCCP; and (3) the technical wording of an LCCP provision in relation to payment method services.

Background

The consultation opened on 28 February 2023 lasted 12 weeks, closing on 23 May 2023. As outlined in our blog in March 2023, the Gambling Commission proposed the following changes to the LCCP:

Change social responsibility code provision 3.5.5 – Remote multi operator self-exclusion to extend the requirement to participate in the GAMSTOP multi-operator scheme to all gambling licensees that make and accept bets by telephone and emails.
Add a requirement to licence condition 15.2.2 – Other reportable events that would require all gambling licensees to inform the Gambling Commission when they become aware that a person who has gambled with them has died by suicide.
Amend the text of licence condition 5.1.2 – Payment methods services to ensure that the condition reflects the current legislative provisions, plus a further amendment to ensure that the condition also reflects any further legislative amendments that might come into force in the future.

Consultation response

Having received 77 written responses to the consultation (including 29 from gambling businesses), the Gambling Commission have decided that they will implement each of the three proposed LCCP changes. The Gambling Commission’s rationale for the forthcoming changes, the timeline for implementation and the final wording of the provisions are outlined below.

1. Extend the multi-operator self-exclusion scheme to all gambling businesses that make and accept bets by email

The Gambling Commission’s decision to extend the requirement emanates from their “focus…on assessing the risk of harm (in particular for consumers who are vulnerable) as well as the benefits to consumers of clarity and uniformity of approach to self-exclusion…alongside the additional costs faced by gambling businesses.”

Specifically, they considered that the extension would yield the following benefits:

Consistency with the current approach applied to online gambling services;
Simplicity for consumers, gambling business, the Gambling Commission and GAMSTOP;
Providing the most comprehensive protection for vulnerable consumers.

The amended wording to social responsibility code provision 3.5.5, which is set to come into force on 1 April 2024, will read as follows:

“Applies to: All remote licences except: any remote lottery licence the holder of which does not provide facilities for participation in instant win lotteries, ancillary remote betting when relied upon to provide facilities for betting via a machine (commonly known as self-service betting terminals) on premises where a betting or track premises licence has effect, remote general betting (remote platform), remote betting intermediary (trading room only), gaming machine technical, gambling software, host, ancillary remote bingo, and ancillary remote casino licences.

1. Licensees must participate in the national multi-operator self-exclusion scheme.”

2. Reporting deaths by suicide to the Gambling Commission

The Gambling Commission considers that their decision to require gambling businesses to inform them upon becoming aware that a customer has died by suicide is “both reasonable and proportionate”. The Gambling Commission has clarified that they “are not expecting gambling businesses to determine whether the person’s death was caused by or connected to their gambling activity”, which is the responsibility “for a coroner or the police to determine”. Nonetheless, the Gambling Commission will “require notification as early as possible”.

The Gambling Commission cited further reasons for their decision, including in relation to data integrity, privacy and/or data protection issues and economic impact.

The added requirement to licence condition 15.2.2, which is set to come into force on 1 April 2024, will read as follows:

“Applies to: All operating licences.

2. The licensee must notify the Commission, as soon as reasonably practicable, if it knows or has reasonable cause to suspect that a person who has gambled with it has died by suicide, whether or not such suicide is known or suspected to be associated with gambling. Such notification must include the person’s name and date of birth, and a summary of their gambling activity, if that information is available to the licensee.”

3. Payment services – technical update

The Gambling Commission confirmed that the amendment “simply updates the existing licence condition to reflect the current legislative provisions and also ensures that the condition is suitably future proofed against any further simple legislative changes.”

The updated wording of licence condition 5.1.2, which is set to come into force on 31 January 2024, will read as follows:

“Applies to: All remote casino, bingo and betting operating licences, except ancillary, host and remote betting intermediary (trading room only) licences.

1. Licensees must only accept payment from customers using their gambling facilities in Great Britain by a method which involves the provision of payment services as defined in Schedule 1 Part 1 of the Payment Services Regulations 2017 (SI 2017 No 752) if the provider of those services is a ‘payment service provider’ within the definition of that term in regulation 2 of those Regulations (or the equivalent requirements of any UK Statutory Instrument by which those regulations are amended or superseded).”

The consultation asked an additional question regarding any potential equalities impacts that could arise from the proposals. There were very few responses to this question, and the Gambling Commission noted that the responses did not give rise to “themes or major areas of concern”.

Please get in touch with us if you would like assistance on any licensing matters.

19Oct

Gambling Commission reminder to licensees about timely payment of annual fees

19th October 2023 Chris Biggs 221

In its fortnightly E-bulletin of 25 September 2023, the Gambling Commission included two reminders to operating licence holders (“Licensees”). Firstly, about the requirement that they pay their annual fee before the anniversary date of their operating licence and secondly, that it is a condition of the licence that the gross gambling yield (“GGY”) does not exceed the fee category threshold of that licence.

Payment of annual fees

Requirement

Following the Gambling Commission’s grant of an operating licence, Licensees must pay their first annual fee within 30 days of the Gambling Commission issuing their licence. Licensees are then required to pay their subsequent annual fees each year before the anniversary date of their operating licence being issued (section 100(1) of the Gambling Act 2005 (“2005 Act”)).

Failure to make payment on time

The Gambling Commission is required by the 2005 Act to revoke an operating licence in the event of a Licensee’s failure to pay its annual fee before the licence anniversary (section 119(3) of the 2005 Act). However, the 2005 Act permits the Gambling Commission to disapply this requirement, if is satisfied that the Licensee’s failure to pay its annual fee is due to an administrative error. It is of note that there is no requirement that the Gambling Commission commence a licence review before revoking an operating licence for non-payment of the annual fee.

How to make payment

The Gambling Commission will issue an invoice to Licensees six weeks before the annual fee is payable. The invoice can also be found on each Licensee’s Gambling Commission eServices account, through which payment of the invoice can be made.

Annual fees are not refundable by the Gambling Commission, unless an overpayment has been made. For example, no refund would be given if a licence is surrendered the day after the licence anniversary date.

We recommend that Licensees diarise their own reminders, well in advance of the licence anniversary, to ensure the timely payment of annual fees.

Fee categories

It is condition of an operating licence that the gross gambling yield (“GGY”) (or annual gross sales for gambling software licences) does not exceed the upper threshold of the fee category for each licensable activity.

Licensees must therefore monitor their projected GGY or annual gross sales in line with their fee categories, which are displayed on their operating licence. It is of note that fee category thresholds follow the licence anniversary year and not the reporting year (which is stipulated by regulatory returns).

Licensees must apply to vary their operating licence to increase the fee category of a licensed activity before exceeding the upper threshold to avoid breaching the licence condition. Failure to do so may lead to regulatory action. The application to vary can be submitted through eServices, carries an application fee of £40, and must be granted by the Gambling Commission before the licence anniversary date. Licensees who have already exceeded the GGY threshold must regularise the position by submitting an application to vary immediately.

Next Steps

We encourage Licensees to set reminders to pay annual fees, and to ensure the accuracy of their licence fee categories. Further information can be found in the Gambling Commission’s annual fees guidance.

Please get in contact with us if you have any questions about your annual fees and/or fee categories.

19Oct

White Paper Series: DCMS statutory levy consultation – polluters pay is the fairest way…

19th October 2023 Ting Fung 215

The Department for Culture, Media and Sport’s (“DCMS”) consultation on the statutory levy (the “Consultation”) was published on 17 October 2023.

The White Paper stated that the Consultation would consider:

the proposed total amount to be raised by the statutory levy;
how to construct the statutory levy in a fair and proportionate manner; and
consideration of the differing harm associations between sectors and/or associated fixed costs, for example, whether a “polluters pay” principle should be adopted.

We set out below the DCMS’ response to these and other key points of the Consultation.

Proposed total amount?

The Consultation indicates that the new gambling levy, which is expected to be in full force by 2026/2027, will raise an estimated £90 to £100 million per year for research prevention and treatment by 2027.

Construction of the levy

The levy will be calculated based on a percentage of gross gambling yield (“GGY”) and be applicable to both B2Cs and B2Bs. Where GGY is not applicable, percentages should be applied to gross profits instead.

Licensees with more than £500,000 GGY or gross profits will be expected to pay the levy.

Summary of proposed levy rates

Levy rates (% gross gambling yield) when fully in force (2026/27):
• 1% from all online operators (excluding society lotteries with remote licences)
• 1% from remote software licences
• 1% from remote machine technical licences
• 1% from remote pool betting licences
• 0.4% from land-based casino/betting
• 0.4% from non-remote software licences
• 0.4% from non-remote machine technical licences
• 0.4% from non-remote pool betting licences
• 0.1% from land-based arcades and bingo
• 0.1% from society lotteries (including External Lottery Managers and local authority lotteries licensed by the Gambling Commission)

Government emphasises that it is “committed to a proportionate, evidence-led approach” and states that the proposed rates may change depending on evidence received from the Consultation.

Subject to the Consultation response, payment of the levy will be either with the annual fee or on a fixed date, with Government priority being a streamlined process for levy payment and collection.

Government recognises in the Consultation that online providers of higher-risk gambling products “are associated with greater levels of ‘problem gambling’ and gambling-related harm” and therefore “can also reasonably be expected to contribute more to cover the costs of tackling and preventing gambling-related harms”. Nevertheless, Government acknowledges that a polluter pays principle would currently be difficult to implement by product, as the evidence base is not yet sufficient to confirm the particular share of harm by product. In addition, Government’s view of B2Bs as “a crucial part of the broader supply chain fundamental to the industry as a whole” has resulted in the same levy being applied between B2Cs and B2Bs.

Levy distribution

Oversight by:

A central Government levy board comprising the Department for Health and Social Care and Department for Science, Innovation and Technology;
Additional oversight by HM Treasury;
An expert advisory group comprising public bodies with relevant expertise and the third sector will also be established to help prioritise how funds should be used.

Administered by: the Gambling Commission, as directed by Government.

The proposed percentage allocations across the areas of research, prevention and treatment (“RPT”) respectively are:

10-20% to UK Research and Innovation for a Gambling Research Programme.
15-30% for a co-ordinated approach to prevention, early intervention, and education across Great Britain.
40-60% to the NHS, who will be the main commissioner of treatment in England, Scotland and Wales.

What about regulatory settlements and RET payments?

Subject to the final levy system, the Gambling Commission has indicated that it will review its process for approving the destination of settlements, should there be any, and consider how to avoid, as far as possible, a dual system or duplication of work alongside the levy.

Until the levy is implemented, licensees are expected to continue making RET payments as required by the Licence conditions and codes of practice.

Conclusion

Speaking on fairness, Gambling Minister Stuart Andrew has said that:

“Gambling firms should always pay their fair share and this new statutory levy will ensure that they are legally required to do just that.”

The Consultation lasts for 8 weeks, with a deadline of 14 December 2023. Responses should be provided via the Government’s online survey. If you cannot access the link, responses can be sent in PDF or Microsoft Word format to [email protected].

We encourage all to respond and let us know if you wish to discuss or require any assistance.

19Oct

Harris Hagan retains Band 1 ranking in Chambers and Partners

19th October 2023 Harris Hagan 224

We are delighted to announce that Harris Hagan is ranked in Band 1 of Chambers and Partners UK 2024 for Gaming for the 20^th consecutive year.

“The team at Harris Hagan is comprised of experts in their field and is very accomplished at handling the complex landscape of gambling regulation in the UK.”

Partners John Hagan and Bahar Alaeddini continue to be recognised in Band 1. Consultants Julian Harris and Hilary Stewart Jones are ranked as Senior Statespeople. Senior Associates David Whyte and Gemma Boore, together with Associate Francesca Burnett-Hall, continue to be recognised as Associates to Watch. Together they constitute 7 of the 27 gaming lawyers recognised in the directory, befitting our status as a leading specialist gambling law firm. We were also invited by Chambers to write the introduction to the practice area.

We received many positive testimonials, including:

“The lawyers at Harris Hagan are top legal specialists in the remote gaming industry and have been able to assist with all our requests, with the ability to adapt to our business and commercial expectations.”

“John is the go-to person for reliable, practical and sensible advice. He has vast experience across the gambling sector and is able to draw on this to support our business.”

“Bahar is a master at solving complex issues and has an encyclopaedic knowledge of gaming laws and regulations.”

“David is very responsive and knows the industry, regulations and landscape well.”

“Gemma is very easy to deal with as well as very proficient in every aspect of her work.”

“Francesca is always available and very diligent.”

In view of the sensitive nature of much of our work, it is our long-held policy not to name clients in directories, but you know who you are, and we thank you for your continuing instructions and for helping us achieve these impressive rankings.

11Oct

Regulatory returns are under the microscope – but will the key issue be missed?

11th October 2023 Chris Biggs 217

The Gambling Commission’s Director of Research and Statistics, Ben Haden, posted a blog on 6 October 2023, entitled Making better use of operator data.

In the blog, Haden explains that, following industry discussions at the Setting the Evidence Agenda Conference on 9 March 2023, and as hinted at in the Gambling Commission’s Evidence gaps and priorities 2023 to 2026 publication in May this year, the Gambling Commission is introducing two new measures over the next six months that are intended to enable it to gather more detailed operator data.

Measure 1: “Sharpening” the data currently received from licensees in regulatory returns by “removing a significant number of items which are out of date or not useful”; increasing the frequency of reporting requirements for many licensees, from annual to quarterly; and aligning reporting dates.

Measure 2: Commencing a pilot to receive a more detailed “daily aggregated consumer data” from operators (meaning aggregated transaction data over the course of a day – not on a per transaction basis).

According to Haden, Measure 1 will be subject to public consultation in November.

In this article, we discuss Measure 1 and consider its effectiveness in the absence of improvements being made to the current regulatory returns system.

Background

In our recent blog on regulatory returns, we highlighted that the Gambling Commission is taking a tougher approach to regulatory returns and, in particular, will escalate to its Enforcement team any operator which fails to submit its regulatory returns on time. As a reminder, it is a licence condition for all licensees to submit regulatory returns on time (15.3.1 of the Licence Conditions and Codes of Practice). Separately, we understand that the Gambling Commission has established a working group which is seeking feedback on the questions raised in the regulatory return form.

Regulatory returns are clearly therefore under the microscope internally at the Gambling Commission – but what is going to change?

Proposed changes to regulatory returns

As mentioned above, Measure 1 will be subject to public consultation in November 2023. For now, therefore, we have only a generic outline of the proposed changes.

Proposal 1: Certain (out of date and/or not useful) questions to be removed.

We agree that less is more, but will the Gambling Commission also take the opportunity to review the remaining questions and related guidance, to ensure it elicits the correct responses from licensees?

Proposal 2: Frequency of reporting to increase for many licensees.

This change would only apply to licensees that are currently required to submit annual returns, which include (but are not limited to) the following licences:

Adult gaming centre
Betting (limited) (non-remote)
Betting (standard) (non-remote and if less than 50 premises)
Betting intermediary (non-remote)
Bingo (non-remote)
Gambling software (ancillary, non-remote, remote and linked)
Pool betting (non-remote and remote)

The full list of licences and the current frequency of reporting can be found here.

Proposal 3: Regulatory returns reporting dates to be aligned.

We expect the Gambling Commission will require all licensees to submit regulatory returns at the same time, rather than in line with (for example) their own financial reporting periods.

These proposals follow the Gambling Commission’s previous efforts, in 2014, to align regulatory returns (for all licensees) to a periodic reporting frequency from 1 October, the original date the point of consumption licensing regime was due to be implemented. The rationale of these proposals was explained in the Gambling Commission’s Review of remote casino, betting and bingo (‘RCBB’) regulatory return and gambling software regulatory return consultation response, in August 2014. The proposals were abandoned following the judicial review that delayed the implementation of the new regime.

Technology is only as good as the data put into it. Doesn’t the same apply to the Gambling Commission?

Haden opens the blog by stating:

“Operator data is a rich resource in terms of ensuring how we understand how the market is developing, appreciate how interventions we make are (or aren’t) having an impact and at a fundamental level ensure we charge the right fees and can forecast and manage income and finances.”

and concludes it by asserting that:

“better evidence driven by better data, will lead to better regulation.”

Whatever the Gambling Commission’s aims, its intention to collect better industry data is laudable; we cannot argue that better evidence and data should lead to better regulation. However, as we have discussed previously, the current regulatory returns system is imperfect and lacks detail. This lack of clarity has, in our experience, sometimes resulted in incorrect data being provided with the regulatory returns, or being provided under the wrong licensable activity.

This is of course a serious concern from the licensee’s perspective, as it is an offence under section 342 of the Gambling Act 2005 for a licensee to misrepresent or provide false information to the Gambling Commission without reasonable excuse. However, it also raises concerns regarding the quality of data being collected by the Gambling Commission – and thus the reliability of the conclusions drawn therefrom.

The Gambling Commission is right to acknowledge that operator data is a potentially rich resource, but the quality (or otherwise) of the data collected will be key to ensuring that it can be relied upon by the Gambling Commission. Whether data is to be used to calculate correct fees, to manage income and finances, or to identify and evaluate market change does not matter. If the data provided to the Gambling Commission by licensees is incomplete or inaccurate, it will cast doubt on decisions taken by the regulator and may lead to the wrong regulatory outcomes.

When it consults on Measure 1, we hope the Gambling Commission will at the same time propose (and consult on) changes to:

the remaining questions that are posed in regulatory returns; and
the associated guidance,

to ensure there is little to no ambiguity between licensees as to what data should, and should not, be provided.

By taking the time to get the regulatory returns process right now, the Gambling Commission could make significant gains in the future, by ensuring that the datasets it collects going forward are as accurate, and therefore useful, as possible.

Next steps

Licensees should look out for the Gambling Commission’s consultation on Measure 1, which is due to be published in November 2023. Once the consultation is open, we recommend licensees to respond and use the consultation as a platform to raise other concerns about the regulatory returns system, even if they are not specifically raised by the Gambling Commission. In the meantime, licensees can also contact the Gambling Commission about the regulatory returns process by completing its online contact form.

Please get in touch if you have any questions regarding the regulatory returns process or if you would like our assistance preparing a regulatory return.

With credit and sincere thanks to Gemma Boore for her invaluable co-authorship.

06Oct

Harris Hagan continues to be ranked Tier 1 in The Legal 500

6th October 2023 Harris Hagan 240

We are delighted to announce that Harris Hagan continues to be ranked in The Legal 500 2024 as Tier 1 for Gaming and Betting in the UK.

“There’s no one else to go to other than Harris Hagan for everything gaming. One stop shop for all your needs. They deliver trust, confidence and integrity.”

Managing partner John Hagan, alongside consultants Julian Harris and Hilary Stewart-Jones continue to be listed in The Legal 500’s Hall of Fame, and partner Bahar Alaeddini retains her listing as a Leading Individual.

David Whyte, senior associate, has been listed as a Rising Star and remains a key lawyer, alongside senior associate Gemma Boore, and associates Francesca Burnett-Hall and Jessica Wilson.

We received many positive testimonials, including:

“Market leader in gaming law.”

“The team is very knowledgeable about UK gambling laws and engaging with the regulator.”

“The individuals at Harris Hagan have a deep knowledge of not just the British gambling laws, but also of the way in which the regulator operates.”

“In-depth knowledge of gambling licensing in terms of regulations and how they are implemented.”

“Bahar Alaeddini and Jessica Wilson get full marks.”

“John Hagan, Julian Harris and Bahar Alaeddini are prominent leaders in the gaming law field.”

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

26Sep

Bahar Alaeddini named an Emerging Leader of Gaming 40 under 40

26th September 2023 Harris Hagan 220

We are very delighted to announce that Partner Bahar Alaeddini has been named an Emerging Leader of Gaming 40 under 40 by The Innovation Group, organisers of the Emerging Leaders of Gaming, and Global Gaming Business.

The programme recognises professionals under the age of 40 already making significant impacts in the global gambling industry, and the next generation of industry leaders.

This honour recognises Bahar’s continued exceptional impact on the gambling industry since joining Harris Hagan in 2012. Bahar advises many of the world’s largest online and land-based gambling companies, regulators, governments, financial institutions, and private equity firms on gambling law and regulation. Bahar is also at the forefront of thought leadership in the gambling sector, sharing her extensive experience and insight by authoring many articles on the topic, including acting as the editor of the Chambers Global Practice Guide on Gaming Law. Additionally, Bahar is General Counsel of the International Association of Gaming Advisors and top-ranked in Chambers UK and The Legal 500.

The group’s achievements will be celebrated at G2E in the Networking Lounge (Booth 5649) on 11 October 2023 from 4pm to 5pm. The reception is open to all registered G2E attendees, including past honourees and professionals across the Emerging Leaders of Gaming network.