Topic: Promotion Marketing
Who: Gambling Commission
When: 21 November 2013
Where: Great Britain
Law stated as at: 13 January 2013
The Gambling Commission has recently issued new summary guidance for licensing officers on the topic of skill with prize machines (“SWPs”).
While the guidance is aimed chiefly at gaming machines, it is also instructive for marketers conducting prize promotions.
Why should marketers be interested?
Section 6 of the Gambling Act 2005 (the “Act”) defines “gaming” as “playing a game of chance for a prize”.
Clearly this description could potentially apply to numerous promotional prize competitions. If it does, then promoters need to be aware that any “gaming” that takes place in the UK without the requisite licence from the Gambling Commission will breach the Act and could leave those responsible exposed to fines and potentially terms of imprisonment.
It is also worth noting that the definition does not require any stake, bet or other payment, and therefore would apply, in theory at least, to free to enter promotion mechanics, although the risks of enforcement action in this context are likely to be low.
Guidance on SWPs
SWPs are not caught as gaming machines under the Act and therefore do not require a licence from the Gambling Commission to be operated lawfully.
The latest guidance confirms that in order to be classed as an SWP the game in question must not have any mechanism that determines the outcome of the game, such as a compensator or other mechanism that makes the outcome dependent upon chance.
The game must operate in a consistent manner and provide sufficient time and opportunity each time for participants to win using their skill. A game that contains an element of chance, unless it is so slight that it can reasonably be disregarded, will be classed as gaming.
Section 6(2) of the Act confirms that a “game of chance” includes a game that is presented as involving an element of chance. The guidance highlights that the Gambling Commission will take into account the following matters when assessing whether a game is being presented as involving an element of chance:
- how the game appears to the player. It must not look like a game of chance, for example; roulette, bingo or game of cards;
- the name of the game and whether it contains language associated with gambling games, for example ‘stake’ and ‘jackpot’;
- the livery of the machine and whether it contains symbols or graphics associated with gambling games, such as bars, bells, lucky 7s or fruits;
- the appearance of the game itself and whether it contains symbols or graphics associated with gambling games, including (but not limited to) the turn of a wheel, the spin of a coin, the roll of a dice, reel bands, or the random selection of numbers;
- whether the game involves the player in actions associated with gambling games including (but not limited to) placing chips or markers on numbers; and
- any contextual indications such as advertising signage or marketing material.
It is important to note that any one of these factors by itself may not be sufficient to result in the Gambling Commission classifying a particular machine as a gaming machine.
Why this matters:
The distinction between a game of chance and a game of skill can be a difficult one to assess. This latest document from the Gambling Commission provides a helpful reminder of their approach in this area, allowing those involved in organising prize promotions to ensure compliance with the Act.