01Nov

Gambling Commission appoints new Commissioners

1st November 2023 Adam Russell 176

On 31 October 2023, the Department for Digital, Culture, Media and Sport (“DCMS”) announced the Secretary of State had appointed seven new independent Commissioners to the Gambling Commission, taking effect from 11 September 2023. Charles Counsell, Helen Dodds, Sheree Howard and Claudia Mortimore have been appointed for terms of five years. Lloydette Bai-Marrow, Helen Phillips and David Rossington have been appointed for terms of four years. Together with the existing Commissioners and Chair, Marcus Boyle, they form the Gambling Commission’s Board of Commissioners (the “Board”).

Appointment process

Earlier this year, DCMS advertised to fill six Commissioner vacancies, to include three appointees with expert experience in one of: consumer protection and insight; data science and digital innovation; and law enforcement. In the end, seven Commissioners were appointed rather than the advertised six.

The Gambling Commission’s job advert made clear that the Commissioners will have responsibility for:

Ensuring that the Gambling Commission fulfils its statutory objectives and duties;
Ensuring that any statutory or administrative requirements for the use of public funds are complied with;
Setting the overarching strategy for the organisation and making strategically significant decisions;
Setting organisational risk appetite and ensuring a framework for effective identification and mitigation of top risks;
Ensuring that the Board receives and reviews regular information and data concerning the management of the Gambling Commission;
Setting the overarching stakeholder engagement strategy;
Demonstrating high standards of corporate governance at all times.

Meanwhile, the job advert outlined the following essential criteria:

An understanding of the policy and/or legislative environment within which a regulator such as the Gambling Commission operates;
Evidence of working as part of a team towards a shared goal, including ability to make a strong personal contribution;
The ability to analyse complex material and take well-reasoned decisions;
A commitment to improving opportunities for people throughout the UK and access to people from a diverse range of backgrounds.

Various desirable criteria were also set out, including corporate experience in a regulated sector, regulatory experience and experience supporting organisational change (amongst others).

Seven new Commissioners

Both DCMS and the Gambling Commission have published biographies for the new Commissioners and we welcome the strong focus on equality, diversity and inclusion in addition to other relevant experience. We also welcome the appointments, particularly the diverse backgrounds including in commerce and other regulated industries (including law!), and hope that the Commissioners will support and build on the Gambling Commission’s recent efforts to improve relations with industry, acknowledging that better relationships lead to better and quicker regulatory outcomes.

Whilst not intended to be an exhaustive summary, an overview of each Commissioner’s biography is detailed below:

Lloydette Bai-Marrow is an anti-corruption expert and economic crime lawyer. She is the Founding Partner of Parametric Global Consulting, the Chair of the Board of Spotlight on Corruption and sits on the Legal Panel for Whistleblowers UK. She is also a trustee for the Unite Foundation, and a Member of the Conduct Committee of the Institute of Chartered Accountants in England and Wales. Lloydette is also a Co-Founder and Director of the Black Women in Leadership Network.
Charles Counsell OBE was the Chief Executive Officer of The Pensions Regulator from April 2019 to March 2023. Before this, he was the Chief Executive Officer of the Money Advice Service and Executive Director of Automatic Enrolment at The Pensions Regulator.
Helen Dodds OStJ is an international lawyer, consultant and board member. She is currently a board member of the Human Tissue Authority, a director and trustee of the St John’s Eye Hospital Group, a director of LegalUK, and an Honorary Senior Fellow of the British Institute of International and Comparative Law. Previously, she was a board member of the London Court of International Arbitration.
Sheree Howard has over 25 years’ experience of the UK financial services industry with knowledge of the process of regulation and a focus on risk management, audit and controls. She is currently the Executive Director of Risk and Compliance at the Financial Conduct Authority, and is a Fellow of the Institute and Faculty of Actuaries. She has also held senior positions in banking in areas of risk and compliance including at the Royal Bank of Scotland and Direct Line Group.
Claudia Mortimore has over 25 years’ experience of criminal law and regulation. After accumulating 10 years of experience as a barrister, she prosecuted drugs, tax and money-laundering offences for the Revenue and Customs Prosecutions Office and fraudulent trading offences for the Department of Business. She has also held senior positions in the Enforcement Division of the Financial Reporting Council.
Helen Phillips is an experienced executive and non-executive, with a career underpinning the public, private and not-for-profit sectors. Helen is currently appointed in a non-executive capacity as the Chair of NHS Professionals Ltd and Chair of the Chartered Insurance Institute. She is also concluding a nine-year term as Chair of Chesterfield Royal Hospital NHS Foundation Trust. Helen has also held various other positions within social work, education and environmental organisations.
David Rossington CB is a former senior civil expert. He has worked for the Department for Culture, Media and Sport as Finance Director and acting Director General. He has also worked for other Government departments including what is now the Department for Levelling Up, Housing and Communities.

Remuneration and Governance Code

The DCMS’ website confirms that Commissioners are remunerated at £14,160 per year (£295 per day) plus expenses, and that the seven appointments were duly made in accordance with the Cabinet Office’s Governance Code on Public Appointments (“the Governance Code”). The Governance Code requires the declaration of any significant political activity undertaken by an appointee in the last five years (e.g. holding office, public speaking, making a recordable donation or candidature for election); none of the appointees declared any significant political activity.

31Oct

Revised remote customer interaction guidance comes into effect

31st October 2023 David Whyte 194

The Gambling Commission’s revised remote customer interaction guidance (“CI Guidance”) has today (31 October 2023) come into effect, along with the requirement set out in Social Responsibility Code Provision (“SRCP”) 3.4.3 that remote licensees must take the CI Guidance into account.

As readers of our blog will no doubt be aware, we have provided several updates (for example, in December 2022 and January 2023) on, and been critical of, the evolution of the CI Guidance, since the first announcement by the Gambling Commission on 14 April 2022 of the new SRCP 3.4.3 and the associated CI Guidance.

The Gambling Commission has now set out its requirements. Irrespective of their views about the CI Guidance, it is vitally important that those remote licensees to which the CI Guidance applies are compliant with SRCP 3.4.3 and can demonstrate that they have taken the CI Guidance into account. We do not propose to further analyse the CI Guidance in detail in this blog. Rather, we set out below some key considerations for those licensees who must comply with these requirements.

Key considerations

Consideration 1: Be wary of the language used in the CI Guidance

We have previously raised concerns about the Gambling Commission introducing formal requirements through guidance, and about the risk that the language used in the CI Guidance might: (a) inaccurately reflect the requirements set out in SRCP 3.4.3; (b) cause confusion; and/or (c) expose licensees to the risk of broad interpretation by the Gambling Commission.

We note that the Gambling Commission has retained its use of “must” and “should” in the CI Guidance, having confirmed in its response to its consultation on the CI Guidance, published on 24 August 2023 (the “CI Consultation Response”) that it has “ensured that consistently appl ‘must’ language when quoting or referring to the requirements, and use ‘should’ language when referring to guidance which must be taken into account”. Licensees should take note of this distinction, but at the same time be aware that the requirement imposed by SRCP 3.4.3 to “take into account” the CI Guidance might effectively make such distinction irrelevant.

Consideration 2: Document your decision-making processes

As the Gambling Commission explains in the CI Guidance, SRCP 3.4.3 “sets out the requirements relevant licensees must comply with in relation to remote customer interaction. For compliance and enforcement purposes, will expect licensees to demonstrate how their policies, procedures and practices meet the required outcomes. This can be through implementing relevant parts of the guidance or demonstrating how and why implementing alternative solutions equally meet the outcomes”.

Licensees will likely be aware that the Gambling Commission has taken a very literal approach to the interpretation of its guidance in the past (e.g. its guidance for remote and non-remote casinos on the prevention of money laundering and combating the financing of terrorism). It is therefore likely that the Gambling Commission will take the same literal approach in relation to the CI Guidance. Licensees should ensure that they carefully document their decision-making process in relation to the CI Guidance, in particular in cases where their approach is inconsistent with, or diverges from, the CI Guidance. This documented decision-making process will enable licensees to demonstrate to the Gambling Commission that they have met their regulatory obligations in the event of future oversights and/or regulatory scrutiny.

Consideration 3: Licensees are not expected to screen all customers for every indicator of vulnerability

The Gambling Commission makes it clear in the CI Guidance that its “aim” for SRCP 3.4.3(3), which requires licensees to “consider the factors that might make a customer more vulnerable to experiencing gambling harms”, is to ensure that “where licensees know that customers are in a vulnerable situation, these customers are supported”. Licensees should note that the Gambling Commission also confirms that it does not expect licensees to screen all customers for each of the factors of vulnerability set out in the CI Guidance.. Rather, it expects that licensees “consider and act on information that they have available to them” (our emphasis added).

Consideration 4: Not all information included in the CI Guidance is required to be taken into account

The Gambling Commission clarified in the CI Consultation Response that certain information included in the CI Guidance is not required to be taken into account by licensees. Rather, that information has helpfully been included in an attempt to provide licensees with clarification or additional explanation to assist their understanding. Licensees should ensure that they are aware of this distinction, particularly when they are revising their policies and procedures and/or documenting their decision-making process.

A helpful example of this is the additional information – which is not required to be taken into account – set out below paragraph 5.3 of the CI Guidance. This lists further sub-categories of potential indicators of harm which, whilst not required indicators, may be of particular use to licensees when considering the formal indicators that they are required to incorporate into their approach to customer interaction by SRCP 3.4.3(5).

Consideration 5: No change to affordability requirements (yet!)

At present, the Gambling Commission’s position on customer affordability has not changed. Whilst the Government set out its proposed financial risk check model in the White Paper, upon which the Gambling Commission is consulting, the CI Guidance does not address those issues. Rather, it restates the current position at paragraph 4.6, reminding licensees that: (a) open source data that can assist them in assessing affordability exists; (b) thresholds should be realistic and based on average available income; and (c) they should be aware of the distinction between ‘disposable income’ and ‘discretionary income’.

Consideration 6: Manual reviews of automated decisions are only required if customers contest that decision

SRCP 3.4.3(11) requires that “icensees must ensure that strong indicators of harm, as defined within the licensee’s processes, are acted on in a timely manner by implementing automated processes”. It also requires that, where such automated processes are applied, “the licensee must manually review their operation in each individual customer’s case and allow the customer the opportunity to contest any automated decision which affects them”.

The Gambling Commission clarified its position in relation to this manual review in the CI Consultation Response and does so again in the CI Guidance, stating that its expectation is that “where a decision is made solely by automated means and which has legal effects or similarly significantly affects a customer the licensee contacts the relevant customer to inform them of the decision and their right to contest it”. It is only where the customer exercises their right to contest the decision that a substantive manual review must be undertaken.

Licensees should take steps to review their data protection processes and procedures to ensure that they are consistent with both data protection legislation and the Gambling Commission’s expectations as set out in the CI Guidance.

Consideration 7: Do not overlook evaluation

Licensees are likely to have gone to significant lengths to ensure their adherence to the burdensome requirements set out in the CI Guidance, with particular focus on indicators of vulnerability and harm. In doing so, there is a risk that they may have overlooked the importance of evaluation as required by SRCP 3.4.3 (12)-(14). Licensees should therefore ensure that their approach to customer interaction incorporates the mandatory evaluation processes both at the individual customer level and of the whole system, and that those evaluation processes are documented and audited.

Next steps

Please get in touch with us if you would like to discuss the CI Guidance, or if you would like assistance with drafting and/or updating your policies and procedures in light of the CI Guidance.

27Oct

Regulatory returns update: Gambling Commission conducting user research sessions

27th October 2023 Chris Biggs 167

In its fortnightly E-bulletin released earlier this week, the Gambling Commission called for licensees to sign up to its User research programme for the purpose of participating in upcoming regulatory returns user research sessions.

As we previously discussed, the Gambling Commission has recently signalled its intention to “sharpen” the dataset currently received from licensees in regulatory returns, increase the frequency of the reporting requirements and aligning licensees’ reporting dates (see its Making better use of operator data blog), which are proposals we very much welcome. The Gambling Commission also indicated that there would be a consultation on the frequency of regulatory returns in November.

User research programme

The user research programme, which is an initiative we welcome, has been introduced to help the Gambling Commission “test new services, websites and features with people who use them” and sessions can take place face-to-face, over the phone or remotely.

Getting involved may include:

responding to questionnaires: 5-10 minutes;
telephone or video call session: 60 minutes;
face-to-face session: 60 minutes; or
workshop: half a day.

You can register as a participant of the Gambling Commission’s user research programme here.

Registration takes approximately two minutes, whereby you will be required to provide your full name and answer general questions pertaining to your involvement in the gambling industry and use of the Gambling Commission’s services. This information will be used to select suitable participants for the regulatory returns sessions, as well as other research sessions.

Regulatory returns user research sessions

The regulatory returns user research sessions will, as the Gambling Commission states, help it “improve the data, while reducing the burden for operators”. The Gambling Commission has asked that a diverse range of licensees from all sectors sign up to the programme, as it will be hosting a series of workshops on the topic with the aim of producing “a more focused dataset”.

The Gambling Commission has not given further details about the regulatory returns user research sessions, nor an indication of when these sessions will be held. We expect that these sessions will take place very soon to inform the Gambling Commission’s consultation on regulatory returns, which we expect in November 2023.

Why participate?

As we discussed previously, in looking to update the regulatory returns system, the Gambling Commission has the opportunity to refocus its dataset and provide clarity and further guidance on the system. Doing so will ensure the evidence it collects from licensees is accurate and therefore useful. It is equally important to ensure the system is fit for purpose and there is consistency in the responses provided.

We encourage licensees and other relevant industry stakeholders to sign up and participate in the regulatory returns user research sessions, and to provide feedback to the Gambling Commission.

Please get in contact with us if you have any questions about the regulatory returns process.

26Oct

Andrew Rhodes’ speech at the International Association of Gambling Regulators Conference: A call for collaboration

26th October 2023 Adam Russell 190

The current Chief Executive Officer (“CEO”) of the Gambling Commission, Andrew Rhodes, delivered a keynote speech at the International Association of Gambling Regulators (“IAGR”) Conference in Botswana on 16 October 2023. In this blog, we sum up the key messages from Rhodes’ speech, which was delivered to gambling regulators from across the world. Part One outlines Rhodes’s commentary on implementation of the UK Government’s Gambling White Paper, and Part Two summarises what was said regarding the Gambling Commission’s increasingly innovative approach to tackling black market gambling.

Part One: The White Paper

Background

Rhodes introduced the White Paper by stating that the Gambling Commission is “pleased to see so many of recommendations adopted”. He proceeded to describe “the publication of the White Paper an important moment”, citing the need to update the gambling regulatory framework with “evidence-based changes” to keep pace with digitisation in society.

Priorities

Rhodes acknowledged that “the White Paper is a key priority for the Commission”. However, he managed expectations by stating that “this will not be the work of a few months” given that the “Gambling Commission is either leading or supporting on the implementation of Government policy” in relation to “over 60 areas of work”. Rhodes then distinguished between priorities for the Government versus priorities for the Gambling Commission, the latter of which included to:

“ensure bonus offers and incentives do not lead to excessive or harmful gambling,
set further product controls for safer online games,
require operators to identify and take action for financially vulnerable consumers and to tackle significant unaffordable gambling through frictionless checks that are not disruptive for consumers.”

Rhodes noted that some of these themes would be common to all regulators at the conference and that while “attitudes, politics, regulatory frameworks and so on may be quite different”, human behaviour is similar cross-jurisdictionally, which may lead to “some commonality in the way approach these areas”.

Prior and upcoming consultations

Rhodes confirmed that the Gambling Commission has received “over 2,300” responses to its first round of White Paper consultations and that those responses “can and will help us improve the changes we make to our rules and to how gambling is regulated in Great Britain”. He considered, however that there have “been some misunderstandings” in relation to financial risk checks, some of which he put down to the complexity of the issue the Gambling Commission is facing. However, according to Rhodes, in other cases, misunderstandings have arisen as a result of “deliberate misinformation designed to muddy the waters of debate and to torpedo the implementation of Government policy.” This is potentially (we think) a not-so-subtle reference to the open letter to Racing Post readers published in September 2023, in which the Gambling Commission complained that the Racing Post has been writing imbalanced stories about the financial risk consultation.

Rhodes went on to confirm that progress is underway on launching “the next tranche of consultations”, which will initially include:

socially responsible incentives (such as bonuses and free bets), and
gambling management tools (including online deposit limits and opt-outs),

with further consultations to follow in 2024.

Gambling data and the evidence base

Rhodes noted that besides consultations, the Gambling Commission is “leading on” improvements to “gambling data” and “the evidence base”. He mentioned that the Gambling Survey of Great Britain will launch early next year. It is set to be the “largest survey of its type” worldwide and attract around 20,000 respondents annually.

He proceeded to outline the “inherent conflict” in relation to the use of problem gambling data, particularly in the context of polarised debate. Rhodes noted that some may seek to cite a low problem gambling rate of between 0.3 percent and 0.5 percent of the population, at the same time as arguing that the same “sometimes limited” sample sizes create “insufficient evidence to support intervention in areas of higher risk”. Although this is contradictory, Rhodes acknowledged that the evidence base requires improvement and promised that the Gambling Survey of Great Britain would help to achieve this – with updated questions for the digital age and “predictable, regular data” for study.

With regard to the broader evidence base, Rhodes reiterated the six priority objectives which were set out in the Gambling Commission’s three-year evidence gaps paper, namely:

early gambling experiences and gateway products;
the range and variability of gambling experiences;
gambling-related harms and vulnerability;
the impact of operator practices;
product characteristics and risk; and
illegal gambling and crime.

Part Two: The black market

Background

In the second half of the speech, Rhodes explained that the Gambling Commission has been taking an increasingly robust approach towards the black market. As above, the tackling of illegal gambling is a priority area of the Commission’s three-year evidence gaps paper, published in May 2023. Rhodes emphasised that while the black market is an issue, it “is not a significant concern” due to the high rate of channelisation. Channelisation refers to the proportion of consumers who gamble in the licensed market in comparison to the illegal market.

Actions

Rhodes outlined some of the actions that the Gambling Commission has been taking to “disrupt unlicenced , illegal online operators through collaboration with others”, which has broadly involved “going upstream, further away from where formal powers begin”. This means working with others to intervene between illegal operators and British customers to “generally frustrate their business and force them out of the market”.

Rhodes gave examples of what this work entails:

increasing engagement with payment providers and financial institutions,
collaborating with internet search and service providers to delist illegal operators from search results and geo-block their websites,
working with social media companies to remove posts which promote illegal gambling,
cooperating with Gambling Commission software licensees to prevent access to products which appear to be available on illegal sites, and
engaging with Gambling Commission licensees where affiliates have placed adverts on illegal websites.

Results

Rhodes revealed that the Gambling Commission’s combative approach has:

“more than doubled the number of successful positive distribution outcomes”
“close down hundreds of illegal lotteries”
“stop influencers promoting unlicensed gambling.

Further, between May and July, Rhodes explained that geo-blocking had restricted access to four of the top 10 illegal domains, and there was a 46 percent reduction in traffic to the largest illegal sites.

The Gambling Commission also “block 17 sites from Google search results through collaboration with Google, and “remov payment facilities from illegal sites” through their work with Mastercard.

Next steps

Rhodes pledged to “continue to study the impact of interventions and respond accordingly”, and to “deepen collaboration with partners in industry, tech and finance” to further strengthen their disruptive capabilities.

Moreover, Rhodes revealed that the Gambling Commission would be holding a Conference in March 2024 to explore “how can work with partners to further decay, frustrate and drive out illegal gambling”.

Rhodes reflected that “strong collaboration with others”, including with other regulators, has been crucial to the results the Gambling Commission’s disruptive enforcement work has yielded so far. However, he wants to see further collaboration take place and urged other regulators to join him in forging and strengthening relationships.

Reflection

This is Rhodes’ second time speaking at the IAGR conference. His last speech, delivered in Melbourne in October 2022 at a time when the White Paper was still pending, appealed for gambling regulators to work better together; share data and evidence; adopt common approaches; and coordinate actions where possible.

This year, Rhodes recognised the role that collaboration has had in successful outcomes during the last year, including in relation to tackling illegal online operators, and reiterated his call for overseas regulators to “share notes” with the Gambling Commission on gambling operators that trade globally.

Rhodes also emphasised that the Gambling Commission is “more than ready to work with ” – referring to a recent roundtable with nine US and Canadian jurisdictions as an example of the Gambling Commission “establish clear working relationships that will support all of us to be more effective”.

At the conclusion of the conference, IAGR members elected Ben Haden of the Gambling Commission as their new president. Mr Haden takes over the presidency from Jason Lane, the Chief Executive of the Jersey Gambling Commission.

Next steps

Please get in touch if you would like to discuss any aspect of this speech or if we can otherwise assist you. You can find out more about the services Harris Hagan provides here.

This blog has been written on the basis of the published version of Rhodes’ keynote speech available here, which may differ slightly from the delivered version.

13Oct

Gambling Commission speech at G2E 2023: Growing importance of international collaboration

13th October 2023 Chris Biggs 185

Tim Miller, the Gambling Commission’s Executive Director for Policy and Research and Senior Responsible Owner for the White Paper, delivered a speech at the Global Gaming Expo (“G2E”) in Las Vegas on 10 October 2023. In his speech, Mr Miller discussed (1) the “growing importance” of international collaboration with other gambling regulators, (2) how this is assisting in tackling illegal online gambling and (3) the progress of the White Paper and changes to the law and regulations in Great Britain, which remains the largest licensed online gambling market in the world.

This blog, whilst not intended to be a comprehensive overview, will summarise those three key themes from Mr Miller’s speech.

Growing importance of international collaboration

Mr Miller stated that gambling is a global industry and that leading operators and suppliers are now (mostly) multi-national businesses. The Gambling Commission’s motivation to collaborate with international regulators has been piqued, as it witnesses more large British or European operators seek to establish themselves in North American jurisdictions. Indeed, Mr Miller declared:

“Increasingly we regulate the same companies; we address the same risks; we face the same challenges.”

In an effort to provide clarity about what the Gambling Commission means by strengthening its relationships with other regulators abroad, Mr Miller explained that the Gambling Commission continues to look to support new regulators in burgeoning jurisdictions and learn from their experiences, suggesting:

“The more gambling regulators know of each other’s rules, standards and markets, the more we are sharing information and best practice, the more we support each other then the more effective we will be.”

Consistent with the Gambling Commission’s tough stance on compliance and enforcement (indeed, Mr Miller mentioned the Gambling Commission broke its own record for “the largest ever settlement” twice in the last financial year), Mr Miller also gave a clear warning for licensees who are non-compliant in one jurisdiction not to be surprised if they are “the subject of regulatory conversation in other jurisdictions.”

Further collaborative efforts mentioned by Mr Miller include:

He, alongside the Gambling Commission’s Chair, Marcus Boyle, hosted a roundtable discussion at G2E with North American regulators on the practical steps the Gambling Commission will take to enhance regulatory collaboration;
the Gambling Commission is close to concluding a number of Memoranda of Understanding with US regulators, which look to establish clear working relationships with those regulators; and
the Gambling Commission continues to build stronger links between the North American Gaming Regulators Association and the Gambling Regulators European Forum.

Collaboration improving the combat against illegal online gambling

Mr Miller used illegal online gambling as an example of why international collaboration is important: what is illegal in one jurisdiction may not be in another, and some jurisdictions do not regulate online gambling at all. The key point made here is, as Mr Miller states, “legitimate, licensed operators from one jurisdiction can actually be the illegal or black market in another.” Tackling illegal online gambling is therefore a particular focus of the Gambling Commission and one which it relies on international collaboration to deliver greater results in making gambling safer, fairer and crime-free.

In terms of results, Mr Miller announced that by engaging and collaborating with payment providers, internet search providers and product and game developers, the Gambling Commission has delivered a 46% reduction in traffic to the “largest illegal sites coming into market.” Notably, Mr Miller indicated that the Gambling Commission’s Chief Executive, Andrew Rhodes, will be providing further information on this topic in a speech at next week’s International Association of Gambling Regulators conference.

Lastly, Mr Miller explained that the Gambling Commission continues to hold discussions with regulators in Europe and as far away as Australia to improve its response to illegal online gambling and influence on those outside of the gambling industry, declaring:

“The collective voice of gambling regulators across the globe pressuring big tech companies, banks and even some other jurisdictions to address the role they play in facilitating illegal gambling, will be much harder to ignore.”

Update on Great Britain’s changing regulations

Referring to the Gambling Commission’s first consultation following the White Paper released on 26 July 2023, Mr Miller indicated that the Gambling Commission has already received “thousands” of responses to these consultations. We strongly encourage stakeholders within the industry to respond to this consultation before it closes shortly on 18 October 2023.

Additionally, Mr Miller indicated there has been progress with the GamProtect project, which grew out of the Gambling Commission’s challenge to the gambling industry to produce a holistic view of risk of harm, known as the Single Customer View. Mr Miller indicated that the Gambling Commission has been working with the Betting and Gaming Council and the Information Commissioner to set up a pilot for this project and ensure the data gathered will only be used to protect people from harm.

Lastly, Mr Miller indicated that the Gambling Commission is finalising its new methodology for the collection of Participation and Prevalence data as part of the Gambling Survey of Great Britain. The Gambling Commission expects this survey (1) to have 20,000 respondents per year, (2) will be the “largest of its kind in the world when up and running”, and (3) will become the “new gold standard” of gambling data in Great Britain. Mr Miller stated the Gambling Commission is clear that “better data will lead to better regulation and better outcomes for both consumers and operators as a result.” As we have discussed previously, this is something we strongly support; better evidence and data should lead to better regulation, but time will tell.

Summary

Gambling is a global industry with global gambling businesses. The Gambling Commission’s desire to increase collaboration, especially against the backdrop of the Gambling Act Review and its previous speeches, is unsurprising. As Mr Miller acknowledged, “o regulator – regardless of their experience or scale can be the world police” for the gambling industry. Watch this space to see what increased collaboration amongst international regulators means!

11Oct

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

11th October 2023 Chris Biggs 179

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 195

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.

22Sep

DCMS publishes correction to online slots consultation

22nd September 2023 Adam Russell 190

On 20 September 2023, the Department for Culture, Media and Sport (“DCMS”) published a correction note in respect of its open consultation on the imposition of a maximum stake limit for online slots games.

Correction note

DCMS have made a correction to Chapter 5 of the original consultation document, within which it was incorrectly reported that, according to the Public Health England Gambling-related harms evidence review, problem gambling rates are highest in the 16 to 24 age group (at 1.5%). However, 1.5% is in fact the problem gambling rate for men in that age group, rather than all respondents. In actuality, the rate for all respondents in the 16 to 24 age group is 0.8%. According to the Health Survey for England 2018, the problem gambling rate in the 16 to 24 age category is 1.0% – which was the highest of any age group.

The timing of this correction is interesting, particularly given the open letter published by the Gambling Commission’s CEO, Andrew Rhodes, in August 2023, in which Mr Rhodes raised concerns about the misuse of gambling statistics. The accurate use of data, it seems, is becoming increasingly important for all stakeholders.

Extension to deadline for submission of responses

The original deadline for submission was 20 September 2023 at 11:55pm. In view of the correction made to Chapter 5, DCMS have extended the original deadline by two weeks, to 4 October 2023 at 11:55am. This is to “give respondents time to consider the correction and respond on this basis”.

Next steps

DCMS have advised that any respondents who wish to resubmit should email [email protected] to do so.

Please get in touch with us if you would like to discuss this matter further or require our assistance preparing a response.

22Sep

DCMS Committee inquiry on gambling regulation

22nd September 2023 Harris Hagan 202

In case you missed it earlier in the month, on 5 September 2023, the Rt Hon Stuart Andrew MP (Gambling Minster), Ben Dean (Director, Sport and Gambling at DCMS), Andrew Rhodes (Chief Executive, Gambling Commission), Sarah Gardner (Deputy Chief Executive, Gambling Commission) and Tim Miller (Executive Director for Research and Policy, Gambling Commission) appeared before the DCMS Committee examining the Government’s approach to the regulation of gambling. The Gambling Commission gave evidence in the first session at 10am, and the Gambling Minister and DCMS gave their evidence in the second session at 11.30am.

Watch the recording of the DCMS committee oral evidence sessions:

22Sep

Julian Harris wins VIXIO’s 2023 Compliance Lifetime Achievement Award

22nd September 2023 Harris Hagan 192

We are very delighted to announce that Consultant and Founder Julian Harris has been awarded the Global Regulatory Award for Compliance Lifetime Achievement by VIXIO Regulatory Intelligence.

This special award recognises Julian’s unprecedented work in trailblazing a “culture of compliance and regulatory standards within the industry” for more than 40 years. During that time, Julian has advised 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. Julian has also been at the forefront of thought leadership in the gambling sector, sharing his extensive experience and insight on various gambling regulatory issues by authoring many articles on the topic, including acting as editor of global publications on gambling law, and in his speeches at conferences across the world. He also served as President of the International Association of Gaming Advisors, the first person to do so from outside North America, testament to the esteem in which he is held amongst gaming advisers worldwide.

Julian first came to specialise in gambling law in 1981 representing the Gaming Board for Great Britain (the then British regulator). He co-founded Harris Hagan with John Hagan in 2004, in anticipation of the Gambling Act 2005 and the expected growth of the gambling industry in Great Britain. It was a bold and inspired decision at a time when niche law firms were rare in the City of London.

Upon receiving this distinguished award, Julian commented:

“I am greatly honoured and humbled by this award. I have felt privileged to have enjoyed being a part of this exciting industry for some 40 years, working with industry, fellow advisers and regulators internationally.
To receive this award from such a distinguished panel of judges and from the most respected global regulatory awards is particularly gratifying.”

The 2023 Global Regulatory Awards will take place on 29 November 2023.

Gambling Regulation