Who: The Gambling Commission
Where: United Kingdom
When: 8 December 2020
Law stated as at: 25 January 2021
On 8 December 2020, the Gambling Commission launched the terms for its long-expected review of current gambling laws.
The launch of this review follows a widely-supported pre-election manifesto promise from the current government. The stated intention is to ensure that the legislation (the Gambling Act 2005) is “fit for the digital age” and the review’s three aims are: (1) to examine whether changes to gambling regulations are needed, especially where technology has moved beyond the scope of the 2005 Act; (2) to strike a balance between consumer freedom and harm prevention; and (3) to ensure customers are protected whether they gamble online or via retail channels.
One of the six main areas covered by the review is marketing, with key areas of marketing set for review including that of “bonusing” (i.e. whether licenced operators should be able to provide promotional offers, such as free spins, bonuses and hospitality), the positive and negative impacts of sports sponsorship and the effectiveness of mandatory safer gambling messages within advertisements.
Alongside looking into potential harms of advertisements, the government also recognises the significant contribution the gambling industry makes to the economy, “employing nearly 100,000 people, paying approximately £3bn per year to the government in taxes, and accounting for £8.7bn or 0.5% of UK Gross Value Added (GVA”)”. The government also notes that in recent years, as with other sectors, there has been a shift in focus to advertising online and via social media. The government’s Call for Evidence cited analysis by GambleAware that estimated that, in 2017, the gambling industry spent £1.5bn on advertising and marketing, around 80% of which was through online channels. The government therefore recognises the significant revenue stream this represents for broadcasts and advertisers and has stressed that it is looking for evidence on this revenue stream, alongside evidence on the harms caused by advertising.
Another of the review’s six main topics is online protections, with the Call for Evidence looking for evidence in order to help the government review the current existing protections for online customers. Topics for review include how current online revenue is distributed between higher and lower-spending customers and whether various controls (such as prize and spend limits) could create a safer gambling environment. In particular, the government is exploring whether to impose limits on the value of stake customers can place when gambling online. Stake values for online customers are currently unrestricted, in contrast to fixed odds betting terminals in licensed bricks-and-mortar venues and this is an area that may well be amended in future legislation. The government is also set to review new and emerging technologies, including delivery and payment methods such as blockchain and crypto currencies, in order to identify any potential risks. Another area for review is the use of “white label” brands, precipitated by concerns that white label agreements may be used by brands who would be unable to meet the regulatory standards required to obtain a licence themselves. The government is also considering whether to bring video game “loot boxes” within the scope of gambling law.
Those wishing to respond to the Call for Evidence have until midnight on Wednesday 31 March 2021 to respond.
Why this matters:
As with many other industries gambling has changed enormously in the last 15 years, with innovations in technology responsible for many of the changes. The government therefore see it as necessary to review the legislative framework in order to ensure that it is still effective and that adequate protections are in place to protect those experiencing significant harm.
Although the government recognises the significant contribution the gambling industry makes to the economy, the central theme of consumer protection emerges throughout the Call for Evidence. This is area that has come under increasing scrutiny over the last year in light of the impact of Covid-19, with particular concerns over the heightened risk of problem gambling due to the increasing availability of online gambling and periods of extended lockdown at home coupled with increased financial uncertainty. The launch of this review can, therefore, be seen as the latest in a number of steps taken by the government to tighten gambling laws in recent times.
The government will no doubt be keen to ensure that the launch of this review and the diverse questions raised in the Call for Evidence will enable it to hear from a wide range of voices in the industry, allowing it to refresh gambling legislation to ensure that it is effective in moderns time and reflects the many changes to the gambling industry which have resulted from fast-paced technological change. There will be pressure on the government to achieve the difficult balancing act of ensuring both consumer freedom in a significant industry alongside protection for those that require it. Watch this space for how rules around gambling continue to evolve and take this opportunity to respond to the Call for Evidence here.