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UK LEGAL COMMENT


gambling ombudsman could carry out investigations such as that completed by the Competition and Markets Authority (CMA) in relation to unfair terms and conditions. The Gambling Commission worked together with the CMA and adopted its conclusions, requiring all gambling operators to comply with the undertakings given by those companies subject to CMA action. Recommendations of the ombudsman may therefore be adopted in licence conditions and codes of practice.


How would it be funded?


Almost certainly, the cost of the ombudsman service would be funded by licensed gambling operators. Whether this is on a per case basis, a fixed levy, or scaled based on gambling revenue remains to be seen. Assuming it replaces the role currently filled by the ADR provider appointed by the operator, however, it may not represent a significantly increased cost. If the Financial Ombudsman is taken as a model, a levy (depending on the size of the business) plus per case fee would be used. The Financial Ombudsman makes no charge to operators for the first 25 complaints and charges £750 per complaint thereafter.


How will it fit in with ADR providers?


The Betting Adjudication Service (IBAS) currently fills a similar role to that proposed for a gambling ombudsman. Whilst operators can use alternative adjudication services, IBAS is used by the majority. The difference between an ADR provider and an ombudsman is that an ombudsman would be appointed by the Government, rather than by the gambling operator. IBAS is behind the ombudsman proposal and hopes to


“evolve into” this role itself. Doubt was expressed about this, however, by the Lords Committee which considered that it would not necessarily be seen to have the required impartiality. It is true that the services provided by IBAS are not generally well regarded by gambling consumers, likely due to the fact that disputes are often determined in line with the operators terms and conditions. It enjoys an average rating of 1.8 out of 5 on Trustpilot, with consumers frequently complaining that it sides with gambling operators. Such complaints may be unfair and (as discussed below) a gambling ombudsman is likely to be subject to similar accusations. In evidence to the Lords Committee the Gambling Commission recommended that an ombudsman should replace, rather than complement, existing ADR providers so that consumers were clear about where to go to with disputes. The Lords Committee agreed with this suggestion and it is likely to be implemented by the Government, should an ombudsman be created.


Will it do any good?


Existing ombudsman services in the UK don’t typically receive any more glowing reviews from consumers than IBAS. To take a few further examples from Trustpilot, the Housing Ombudsman has received an average rating of 1.6 stars out of 5, the Legal Ombudsman 1.2 and the Financial


Ombudsman has been rated 1.3. A frequent comment in these reviews is “don’t waste your time”. With a general perception that ombudsmen favour the provider over the consumer, a cynic might find it unsurprising that gambling companies are behind the proposal. One advantage of a gambling ombudsman over the


existing ADR regime is that consumers are more likely to know where to go with a dispute. The negative effect of this higher profile is that more claims may be raised with the ombudsman before the customer has exhausted the operator’s own complaints procedure. It will be important that the ombudsman refers consumers back to the gambling operator in cases where these procedures have not been followed.


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.


JULY 2021 23


MQ-Illustrations/Adobe Stock


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