UK LEGAL COMMENT
Commission introduced additional restrictions on online operators. The early data showed an increase in the use of remote gambling products such as slots, poker and virtual sports betting, however no increase in problem gambling behaviour. It is unprecedented for the Commission to bring in such measures without consultation and the data did not seem to justify this action. Nevertheless, the Commission mandated that operators had to immediately remove reverse withdrawal options and carry out interactions with all customers who play for more than an hour in a single session, among other requirements. Although billed as temporary restrictions, these measures remain in place. In the summer, the Commission made a helpful change
to procedural requirements relating to a change in the location of key equipment, with operators no longer required to vary their licence in these circumstances. The Commission also launched a consultation on enhanced compliance requirements for VIP customers. The new requirements came into force in September. Operators must now conduct an affordability check before offering any customer personalised bonuses, assess whether they are at risk of harm and ensure they have evidence of the customer’s occupation and source of funds. September also saw the introduction of changes to the Industry Code for Socially Responsible Advertising. These included a new requirement that paid-for social media adverts must be targeted at over 25s and that “reasonable endeavours” must be used to exclude any self-excluded or high-risk customers from these campaigns. On their own social media pages operators must now post frequent safer gambling information and they must require their affiliate advertisers to do the same. The Commission also completed its consultation into
proposed changes to the design of online slots in September, although the outcome of this consultation is yet to be published. The proposals include introducing a minimum 2.5 second length for each game cycle, a ban on features such as turbo or quick stop for spins and a ban on auto-play features. If implemented, a number of the proposals will make the online slots experience more similar to play on land-based slot machines. In the future, the Government’s review of the Gambling Act 2005 may well introduce stake limits for online slots, which would further level the playing field for land- based providers. Total regulatory penalties (fines and voluntary
settlements) paid by UK licensed gambling operators in 2020 exceeded £34m. In many cases, the failings found by the Commission related to ineffective customer interactions and due diligence. The Commission also acted on its intention to hold senior individuals accountable for failings by operators, revoking three Personal Management Licences and giving warnings to ten others. In the majority of cases, these individuals were held to account for failing to ensure effective implementation of the operator’s policies and procedures, and failing to ensure compliance with the LCCP, particularly the requirements for customer interaction.
Further increases to the regulatory requirements,
particularly for online operators, are expected in 2021. In particular, the Commission is currently consulting on enhanced requirements for remote customer interaction, including affordability assessments. The consultation will close on 9 February, which means the new requirements are likely to come into effect in the summer. 2021 should also see significant progress on the
Government’s review of the Gambling Act 2005. This will bring much needed certainty to the UK gambling industry, particularly for online operators who are likely to be subject to increased regulatory requirements. At least in its announcement of the review, the Government appears to be approaching the review in a pragmatic way, recognising the need to balance the need to protect those who are vulnerable with the need to preserve individual freedoms of those who are not. All those involved in the gambling industry should see the review as a positive opportunity to engage with the Government on the way the industry is regulated in the future.
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.
JANUARY 2020 31
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