UK LEGAL COMMENT
The new VIP requirements – Q&A
Melanie Ellis breaks down the new Gambling Commission VIP requirements for licensees
T
he Gambling Commission has published new guidance on how licensees should deal with High Value Customers (or “VIPs”). This article addresses some key questions about the guidance, but I would recommend that
operators review the Commission’s document in full. When will the new requirements come into force?
The new guidance comes into force on 31 October 2020. The Commission had little sympathy for respondents
to the consultation who stated that they would need a longer lead time to implement the necessary changes to systems and processes, on the basis that the need to introduce the new requirements is due to “a failure on the part of licensees to collectively raise standards”. In effect, it appears that the Commission now expects licensees to anticipate what future regulatory requirements will be and begin making changes in advance of their publication.
What is the status of the GC Guidance?
The accompanying amendment to Social Responsibility Code Provision 5.1.1 states that “Licensees must take into account the Commission’s guidance on high value customer incentives”. The phrase “take into account” might be taken to mean that operators can take a different approach as long as they have reviewed the guidance. However, the reality is that the Commission will expect operators to comply with the guidance unless they can clearly demonstrate that their alternative approach is equally effective and does not result in lower protection for VIPs. In its consultation response, the Commission states that it “will be vigilant where licensees seek to circumvent the intention of this guidance”. The Commission has threatened that if its
expectations are not met it “will have no choice but to take further action and ban [VIP] schemes”.
When is a customer classed as a VIP?
The guidance applies to customers who are part of a scheme which offers “tailored or personalised incentives linked to high value spend or frequency of play”. This
30 OCTOBER 2020
might include (but is not restricted to), customers offered hospitality at events, a personal account manager and/or individualised bonuses, benefi ts or gifts. Any bonuses or prizes available to the licensee’s whole
customer base, or a large number of its customers, would not be covered by the guidance. Whilst there is flexibility for operators in terms of which customers they consider fall within the scope of the guidance, they need to be ready to justify their definition of a VIP if questioned by the Commission.
What checks are required before making someone a VIP?
The Commission expects the following checks to be undertaken before making someone a VIP: • Affordability – establishing the customer’s spending is “affordable and sustainable as part of [their] leisure spend”. In particular, the Commission notes that a windfall (e.g. from an inheritance or large win) should be treated with caution and sustainable spending needs to be considered. It is not clear from the guidance exactly what an affordability check should entail, however the Commission intends to launch a new customer interaction consultation exercise shortly, which will provide details of the GC’s current approach to affordability checks.
• Safer gambling – assessing whether there is evidence of gambling related harm, or heightened risk linked to
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