UK LEGAL COMMENT
challenges. Reference is made to investing in new software and upskilling staff, but given the financial impact the proposals will have on licensees, the industry surely deserves some more detailed financial projections than have been provided. The proposed fee increases are subject to a consultation exercise, which runs until 26 March.
New remote technical standards
The Commission first proposed a new “game design code” in October 2019, when it suggested that key industry players come together to agree new measures to protect vulnerable customers. The new provisions will come into effect two years after they were first suggested, so will not come as a surprise to operators and game developers. The changes will be implemented on 31 October 2021,
by way of additions to the Remote Technical Standards. In summary, from that date online slots products must: • Clearly display a customer’s net position, • Require a customer to commit to each game cycle (no auto-play), • Display the elapsed time for the gaming session, • Not offer functionality to play multiple slots at the same time,
• Have a minimum delay of 2.5 seconds between each game cycle,
• Not allow customers to reduce the time until the result is presented, and
• Not celebrate a return which is less than or equal to the stake.
In addition, all remote operators (including betting and
lottery providers) must not allow customers to cancel a withdrawal request. This requirement has effectively been in place since May 2020, when the Commission published guidance for operators in light of increased risks presented by the pandemic. The restrictions which apply to online slots are
somewhat limited in their application, as they only apply to “casino games of a reel-based type”. This includes games that have non-traditional reels, including grid- based games. However, the restrictions do not apply to games which may have similar characteristics but are distinct from a slots game. There will inevitably be games which fall into a grey area, particularly as this opens a window for game developers to come up with new product types to avoid the restrictions. The most controversial change was the prohibition of
auto-play functions, which was opposed by 70% of the respondents to the Commission’s consultation. The Commission appears to have been particularly influenced in its final decision by research carried out by GamCare. In a survey of its users, the charity found that around two thirds felt that online slots would be safer without auto-play. Reliance on this type of data to drive regulatory changes does present something of a slippery slope – there are likely to be many restrictions which a majority of problem gamblers believe would increase their safety, potentially including banning gambling altogether. It would not be right to bring restrictions in for that reason alone, without balancing this with the rights of the majority of gamblers who play without experiencing issues.
Many of the changes will serve to narrow the gap
between online slots and those available in land-based premises. In particular, game cycles on B1 gaming machines in casinos must last at least 2.5 seconds and customers must perform at least one action for each time they make a payment. Whilst land-based casinos and gaming machine manufacturers may welcome the online restrictions as levelling the playing field, it seems unlikely that many customers will migrate back from online gaming to playing on physical machines as a result of these changes. Whilst the changes narrow the gap between online and land-based products, they simultaneously widen the gap between licensed and illegal unlicensed operators. Just a few weeks ago the Gambling Commission stated that it believed concerns about the black market were overstated, however one of the key justifications for the proposed fee increases is an expectation of higher costs associated with protecting consumers from risks associated with unlicensed operators. It stands to reason that the more restrictions that are imposed on the nature of the product licensed operators can offer, the higher the chance will be that customers go elsewhere. The Commission’s figures show that the number of illegal websites to which it sends Cease and Desist notices continues to increase. These new restrictions absolutely must be accompanied by a clamp down on illegal operators.
It
may be time for the Government to consider more drastic measures such as mandated payment and IP blocking, to protect both vulnerable consumers and licensees for whom compliance with the UK regulatory regime is becoming increasingly costly.
Melanie is a gambling regulatory lawyer with 13 years’ experience in the sector. Melanie advises on all aspects of gambling law including licence applications, compliance, advertising, licence reviews and changes of control. She has acted for a wide range of gambling operators including major online and land-based bookmakers and casinos, B2B game and software suppliers and start-ups. She also frequently advises operators of raffles, prize competitions, free draws and social gaming products. Melanie has a particular interest in the use of
new technology for gambling products and novel product ideas.
FEBRUARY 2020 27
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