UK LEGAL
However, an open question remains about what steps a sports organisation would need to take to protect themselves from committing the offence.
A person only commits the offence of advertising unlawful gambling if they either “know or should know” that the advertised gambling is unlawful or did not “reasonably believe” the advertised gambling was lawful (this nuance depends on the nature of the advertising arrangements). Whilst the Commission is of the view that due diligence on blocking measures and ongoing monitoring are necessary for a sports organisation to hold the necessary state of mind to avoid committing the offence, this has not been tested in court. Altering the legal position is not within the Commission’s powers, as it can only control licensed operators and prosecute those who are operating or advertising illegally. So, it has liaised with DCMS, resulting in the upcoming consultation on legislative changes.
WHAT ARE THE LEGAL OPTIONS FOR IMPLEMENTING THE BAN?
There are two ways the proposed ban could be implemented that are likely under consideration, although we must await the DCMS consultation to know for sure how it intends to do this.
The first option would be to simply create an offence in the Gambling Act of advertising gambling that is not licensed by the Commission. Primary legislation would be needed to achieve this, so it would take some time (possibly 1-2 years). One option would be to reinstate a similar offence to that of advertising “foreign gambling”, which was included at section 331 of the Gambling Act until repealed by the Gambling (Licensing and Advertising) Act 2014, as part of the introduction of point of consumption licensing. In this offence, “foreign gambling” would be defined as any gambling not subject to a Commission licence, rather than permitting the advertising of gambling subject to the laws of an EEA of White List jurisdiction as per the former offence.
However, the DCMS press release specifically states the consultation will be about “sports sponsorship”. Whilst the offence could be restricted to just covering sponsorship arrangements, it seems more likely that if advertising unlicensed gambling is only to be banned when it comes to sponsorship of sports organisations, the Government would
prefer to implement this through Regulations.
Under section 328 of the Gambling Act, the Secretary of State can create Regulations controlling the form, content, timing or location of gambling advertising. This section was intended to allow for advertising requirements to be introduced such as social responsibility messaging or a TV watershed, but these types of rules have so far been implemented through the ASA’s CAP and BCAP Codes and the voluntary Industry Code, negating the need for Regulations. The CAP Code does not apply to sponsorship arrangements, and the Industry Code is only going to be adopted by licensed operators, so neither of these options could create the proposed ban. Regulations however could specifically apply to sports sponsorship arrangements and breaching them would be an offence for anyone advertising gambling, regardless of their licensed status. From a harm prevention perspective, however, it does seem strange to take a policy decision to ban the advertising of unlicensed gambling, but only in the context of sports sponsorship. In reality, overseas based gambling operators advertising on sports kits are seeking to target other markets, not Great Britain. On search engines and social media, adverts deliberately targeting British consumers with “not on GAMSTOP” messaging abound. If the Government is “deeply concerned about the dangers posed by the unlicensed gambling market”, why not make it an offence for such operators to advertise to British consumers at all?
Unfortunately, it may be that being seen to take action about a visible and vocally complained about form of advertising takes priority over actually addressing the areas of most risk.
HOW WILL THIS AFFECT WHITE LABEL ARRANGEMENTS? One point that remains to be seen in the consultation document is whether the proposed ban will apply to gambling brands not holding their own Commission licence but entering a white label arrangement with a licensed operator to justify advertising their brand via British sports teams. It seems likely that such arrangements will be allowed to continue, as British consumers searching for that brand should be directed to the Commission licensed website, rather than the brand’s “.com” site which it hopes to promote to consumers in other jurisdictions through the sponsorship.
Some wording in the DCMS press release implies otherwise, for example “the new measures would mean gambling companies without a UK licence would be restricted from entering into any sponsorship arrangements with sports clubs”. This suggests that the gambling company must itself hold the “UK licence” to enter a sponsorship agreement. The exact wording of the new measure will answer this question once published, but the most likely outcome is that it will prevent brands that are not “subject to” a Commission licence from advertising in Great Britain.
WHEN WILL THIS COME INTO EFFECT?
The timing of the proposed ban is not set out in the press release, however whether primary legislation or Regulations are chosen to implement it, the new measures will need to be approved by both Houses of Parliament. After the consultation process and debates, the Government may also be willing to give some notice period to sports organisations, given that long term sponsorship arrangements will be in place. Some crystal ball gazing is involved here, but a likely coming-into-force timeframe would be mid-2027.
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.
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