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A successful gambler should not be deprived of the fruits of his bet, but equally in my judgment a losing gambler should not be able to escape the consequences of his decisions. (Paragraph 181, Mr Lee Gibson v TSE Malta LP (t/a Betfair))

In a landmark decision earlier this month, the High Court has confirmed that operators do not generally owe their customers a duty of care under any of the multiple mechanisms tested out in this case.

Mr Lee Gibson v TSE Malta LP (t/a Betfair) [2024] EWHC 2900 (Comm)).

Mr Gibson issued a claim against Betfair, a betting exchange platform, for his losses of up to £1.4 million. His case was predicated on the fact he was a problem gambler and, as Betfair was and is a Gambling Commission licensed operator, they breached the terms of their licence by allowing him to gamble.

HHJ Bird made a number of interesting comments in the Judgment, with a focus on the operations of Betfair and whether they did enough to satisfy the conditions on their licence. A number of serious legal questions were also asked, which I will come to later.

This is a very fact specific case, however several of its elements are applicable to a number of operators and it is well worth a read.

Social Responsibility and the Defendant

Crucially, the Judgment begins by stating ‘If he was not a problem gambler, or if Betfair cannot be taken to have been aware that he was a problem gambler, then most of his claim will fail.’ (paragraph 4).

All good operators have in place extensive customer protection measures, from policies and procedures to staff training and customer supervision, to ensure they are able to protect their customers and uphold the third licensing objective. Social Responsibility policies covering self-exclusion and customer interaction are not dusty documents sitting on shelves anymore. They are, or at least should be, proactive and robust documents which are designed to protect those who are at risk of gambling harms.

This case is a good demonstration of how important it is to ensure that an operator’s procedures are truly effective.

There were therefore two key factors at play here. Firstly, that Betfair was deemed to be a responsible operator. They were found to have credible witnesses, who took their roles seriously and were experienced individuals, and to have ‘live’ documentation, with policies and procedures which evolved with the landscape of the industry and an increasingly involved regulator. Further, their procedures were clearly being actioned and were not simply a tick box exercise.

As an interesting aside, the Operations Director at BETDAQ (a competitor of Betfair) gave evidence, the thrust of which was that ‘Mr Gibson could have placed large bets with BETDAQ on the betting exchange in the same way he had placed bets with Betfair‘ (paragraph 76).

Problem Gambling and the Claimant

Secondly, if a customer deliberately conceals their problem gambling, it is extremely difficult for anyone (operator or medical expert) to determine whether they have, or the level of, a gambling problem.

This raised another interesting point that the shear level of losses was not enough to conclude a gambling problem. In fact, Mr Gibson was the subject of several detailed and intrusive AML and RG checks from Betfair – each time answering questions and providing the documentation requested. On this point the Judge noted ‘Although [the losses] were very large, they appeared to be sustainable.’ (paragraph 15)

He attended football matches as a VIP guest and behaved convivially with all, showing no signs of distress… all of his financial information was sent for forensic checks with the AML team, questions were asked of the Claimant and he made several assurances to Betfair that he was gambling within his means, and was happy with his level of gambling. To further Betfair’s defence, even when faced with threats of lawyers and refusals to co-operate towards the end of the business relationship, they did not back down on any requests and ultimately made the decision to terminate the relationship.

Similar to a reasonable versus best endeavours debate, the Judge commented that ‘Betfair was under no regulatory (or other) obligation to implement the very best or most efficient system to identify problem gamblers. Its obligation was to have appropriate policies in place. In my judgment it did that.’ (paragraph 130)

Consequently, it was found that whilst the Claimant did have a gambling problem, the Defendant was not aware and did not ought to know.

Legal Position

This case has explored a number of complex legal arguments surrounding contractual relationships and the nature of any duty arising in a gambling agreement. There were three legal arguments tested:

• A breach of an implied contractual term under common law
• A breach of an implied contractual term under statute
• A claim of negligence and an alleged common law duty

All of these failed. However, the judge went on to make a number of comments regarding the usual tests in law which would have followed any of these being successful, as well as causation, which are worth a read.

The final legal argument to be tested was that of illegality under section 33 of the Gambling Act 2005 (General Offences; Provision of Facilities for Gambling). Again, this argument failed, with the Judge setting out that section 33 merely had the intention of imposing a penalty on one party. There is no mechanism within this section to render the contract void should the operator breach its licence terms (a big relief for operators…).

The only legal argument which came close to succeeding was the potential duty under common law by way of assumed responsibility. On this point, the Judge commented that ‘If Mr Gibson had asked to be excluded from Betfair or had asked that some formal restriction be placed on his gambling, I think it very likely that Betfair would have become responsible to honour those requests.’ (paragraph 164).

Conclusions

The Judge ultimately concluded that Betfair did not breach their licence terms, that they did not know or ought to have known that the Claimant was a problem gambler, and that even if they had there was no duty arising out of the relationship in any event.

Whilst there are some chaotic elements to this case… with allegations of destroyed Whatsapp evidence, jokes apparently being made at the Claimant’s expense and the fact he had made his problem with gambling known to ‘an unnamed tall man at Betfair’s hospitality box at Old Trafford and the landlord of his local pub in Leeds’ (paragraph 131) It has some very serious underlying themes, and is a very important case for operators.

The full Judgment can be found here-

https://3vb.com/wp-content/uploads/2024/11/LM-2021-000010-Lee-v.-TSE-Malta-LP-t.a-Betfair-FINAL.-docx.pdf

For more information, or for any other gambling queries, please contact Amanda Usher (amanda@woodswhur.co.uk) or your usual Woods Whur contact.

Edited 03 December 2024.

In this article Andy Woods looks at some important changes that will impact on all gambling operators in Great Britain having recently been introduced by the Gambling Commission, as well as looking at the DCMS conclusions regarding key proposals set out in the white paper.

 

A) 16^th May 2024

On the 16^th May 2024 DCMS published its conclusions on certain proposals which will impact on land based operators which can be summarised as follows:-

1. 1968 Act converted casinos will be allowed to increase total gaming machine entitlement proportionate to their size and non-gambling area, with the maximum number of category B gaming machines permitted increasing from 20 to 80 if they meet the size requirements in 2005 Act casinos.
2. This will only be implemented in casinos with a maximum gaming machine to table ratio of 5 : 1 for 1968 Act casinos and small 2005 Act casinos.
3. Permitting all casino premises to provide betting services which were previously restricted to 2005 Act casinos.
4. Adult Gaming Centres and bingo halls to be allowed a ratio of 2:1 category B to category C and D gaming machines where devices are of a comparable size.
5. Removing the prohibition on the direct use of debit card payments on gaming machines subject to the introduction of appropriate play protection measures.
6. Introduction of a legal age limit of 18 for low stake cash out category D style gaming machines.
7. Raising the current fee cap that Licensing Authorities may charge for Premises Licence in England and Wales by 15%.

 

It is likely that DCMS will implement all changes through Parliament, except those related to cashless payments, this year.

 

B) 3^rd June 2024

The Gambling Commission announced  as part of its summer 2023 consultations that the requirement to hold a PML is expanding to include any roles involving AML and counter terrorism, as well as any individuals who hold positions such as Chair of the Board or CEO. This will take effect from 29 November 2024, however applications can take several weeks to be determined.

 

C) From 1^st July 2024

From the 1^st July 2024 the LCCP will be amended to require all licensees to submit regulatory returns on a quarterly basis, within 28 days of the end of each quarterly period, and further information is available on the Gambling Commission website.  The Gambling Commission state that in order to make this transition work for all operators, the end date of all regulatory returns with a period which currently contains the 30^th June 2024 will be changed to end on the 30^th June 2024, so that the new reporting period starts on the 1^st June 2024.  Log in to e-services – operator to ensure that returns are submitted.

 

D) Reminder of other changes announced in Early May

• Financial vulnerability checks being rolled out at £500 from 30 August 2024 and £150 from 28 Feb 2025
• Frictionless financial risk assessments being piloted
• Remote game design being altered to reduce the speed and intensity
• Direct marketing choices being updated – from 17 Jan 2025- to a more granular, opt in approach (type of gambling and specific product) (remote only, does not include lotteries)
• Age verification being tightened for non-remote (test purchasing mandatory, challenge 25 recommended) from 30 August 2024
• Extension of PML holders (people on the board, anyone dealing with AML/POCA etc)
• The proposed changes to regulatory panels wont be coming in! Summer 2023 consultation – Proposed changes to LCCP and RTS: Consultation Response – Summary – Changes to Regulatory Panels consultation (gamblingcommission.gov.uk)

 

Comments

The above two changes which are being implemented immediately highlight the importance of all operators keeping up to date with Gambling Commission communications. There is no doubt that the Commission will be checking whether those holding management positions set out in the link above have obtained PML’s and it goes without saying that the importance of submitting correct regulatory returns on time cannot be overstated.  I will keep everybody updated with the implementation date for the changes to machine entitlement as well as other incoming measures.

I am now getting clients asking me what the impact of Martyn’s Law will be and what are the timescales. It is very difficult to be precise at the moment as we are waiting clarification on the detail. This is very frustrating as the impact could be significant, particularly for larger capacity venues, and we need the detail as early as possible to properly advise and for operators to properly plan.

It is worth keeping an eye on the Home Office blog. This was last updated this month and appears to be updated relatively frequently.

https://homeofficemedia.blog.gov.uk/2022/12/19/martyns-law-factsheet/

The full title of the bill is The Terrorism (Protection of Premises) Bill and it featured in the latest King’s Speech in November. A recent consultation on the Standard Tier provisions was billed as “to ensure the Bill strikes the right balance between public protection and avoiding undue burden on smaller premises, such as village halls and other community venues.”

What do we know so far….

To be in scope of the provisions:

• Premises and events must be accessible to the public.
• Premises must be used for a purpose listed in the Bill (e.g. entertainment and leisure, retail, food and drink).
• Have a capacity of 100 or more individuals.
• Premises may be a building or outdoor locations which have a readily identifiable physical boundary and access by express permission.
• Provision is made in the Bill for temporary events such as festivals that have express permission to enter and a capacity of 800 or more individuals.

How will it work?

The Bill will establish a tiered model, linked to the activity that takes place at a premise or event and its capacity:

Enhanced Tier – this tier will see additional requirements placed on high-capacity venues in recognition of the potential catastrophic consequences of a successful attack. This will apply to premises and events with a capacity of 800 or more individuals, for example, live music premises or events, theatres, and department stores. Those responsible for an enhanced duty premises or qualifying public events must:

• notify the Regulator of their premise or event;
• take ‘reasonably practicable’ measures that will reduce the risk of a terrorist attack occurring or physical harm being caused. The reasonably practicable test is utilised in other regulatory regimes e.g., Health and Safety, and will enable organisations to tailor their approach to the nature of the premises, and their activities and resources;
• keep and maintain a security document, aided by an assessment of the terrorism risk, which must also be provided to the Regulator; and
• if the responsible person is a body corporate, they must appoint an individual as the designated senior individual for the premise or event.

Standard Tier –

In summary, those responsible for Standard Tier premises must:

• Notify the Regulator that they are, or have become, responsible for premises within scope of the Bill (and so subject to the relevant requirements). This remains broadly in line with previous requirements.
• Have in place procedural measures that could be expected to reduce, so far as reasonably practicable, the risk of physical harm to individuals at the premises in the event of an attack. These relate only to the procedures to be followed by people working at the premises in the event of an attack occurring or being suspected as about to occur. As the procedural measures are about procedures for responding to an attack or suspected attack, it is not expected or required that physical alterations be undertaken or additional equipment purchased for Standard Tier premises.
• In contrast to the published draft Bill, there is no requirement to complete a specified form (the ‘Standard Terrorism Evaluation’) for Standard Tier premises or ensure that people working at the premises are given any specific training. However, as part of putting in place the procedural measures, workers will need to be sufficiently instructed or trained to carry them out effectively.

 

Worryingly, not having the detail yet, it suggest the Regulator will monitor compliance and advise premises within scope. The Regulator will have the tools to address non-compliance, including investigatory powers and monetary sanctions. I very much want to see the detail around this.

What strikes fear into advisors is the phrase “Dedicated guidance and support will be provided for Martyn’s Law, to ensure that those in scope have the required information on what to do and how best to do it. As part of this approach, we will expand the support available to those responsible for delivering security in public venues.” We all remember from Covid Regulations how we had very little time to get to grips with the Guidance documents, let’s hope that Government has learned a lesson from that.

 The conclusion is that we are lacking in detail to fully advise, however it is coming and the leisure sector needs to factor this on the horizon. We will continue to keep up with developments and report accordingly.

 

 

As promised in the long-awaited White Paper; the consultations have begun. These have marked the start of the process of implementing some much needed changes across the Gambling sector, and they show no signs of slowing down.

 

Current Gambling Commission Consultations

At the moment there is only one Gambling Commission consultations still open, relating to proposed changes to financial penalties and financial key event reporting. These are relatively straightforward; potential changes to criteria and methodology for the calculation of financial penalties and proposals to help larger companies handle share fluctuations by allowing some licensees to report ownerships over a more appropriate level (for example 5% ownership rather than 3%).

On the face of it; sensible suggestions. In reality; an 86 page consultation document.

The proposed methodology for the financial penalties looks remarkably like sentencing guidelines, and overall would give the GC more power to determine the level of fine it deems appropriate – plus a potential disgorgement element allowing them to raise the fine even further.

During the two-year period between August 2021 to July 2023 £38 million was paid by way of financial penalties, and £44 million was paid  as part of regulatory settlement processes. It doesn’t look like we can expect these figures to decrease over the coming years.

This consultation closes on 15 March – 2023 Consultation on proposed changes related to financial penalties and financial key event reporting – The Gambling Commission – Citizen Space

 

Recently Concluded GC Consultations

A separate consultation closed on 21 February and included proposals to limit incentives, more customer tools to limit gambling, making operators ‘remind’ customers that their funds are not protected and a request that all regulatory returns are submitted quarterly. And removing the soon to be obsolete Research, Education and Treatment contributions.

A similar consultation closed in 2023, relating to yet more changes to the LCCP and RTS. This one contained proposals for suicide notifications, opt-in marketing preferences, remote game design, strengthening age verification procedures, changes to regulatory panels and extending PML requirements.

All in all, a lot of proposals. Some very straightforward, arguably superfluous. Some with some interesting quirks….

Lotteries in particular have been watching these consultations with growing frustration. From the requirement to report suicides leading to potential double counting (with ELMs and society lotteries sharing customers), the statutory levy being 0.1% when they donate 20% to charity (and again… double counting of ELMs and society lotteries) and finally the opt-in marketing proposals which are likely to severely limit how lotteries have always marketed their fundraising efforts.

 

Personal Management Licence Holders

The proposed extensions to PML holders is particularly interesting, demonstrating the GC’s ever increasing need to keep control of the industry. More PML holders means more personal accountability. Some of the new roles which will require PMLs include the CEO (as overall controller), the Chairman of the Board, the MLRO, the Nominated Officer and potentially even directors of a parent company. It looks likely that most companies will no longer have a single PML holder in each key management role.

PMLs have an application fee (£370), maintenance required every 5 years and come with personal accountability including criminal consequences. They are also in-depth applications, with financial, personal and criminal information being declared about an individual.

 

Regulatory Panels – more or less independent?

The proposed changes to the regulatory panels have caused some controversy. The changes propose that the panel be comprised of a legally qualified Adjudicator (as chair), one Commissioner and one member of senior Commission staff, rather than two or three Commissioners with the Chair of the Commission presiding over all panels. The second proposal is that decisions by the Panel be paper-based as the default.

There has always been some confusion about the role of regulatory panels, with many questioning how they can be independent, or the appropriate place for an ‘appeal’, when they are effectively still part of the Gambling Commission. The Commission have always tried to make it clear that their regulatory panels are not an appeal process, that appeals go to the First Tier Tribunal, and that their regulatory panels are simply an internal escalation process.

Unfortunately these proposal seem to have made matters worse. The adjudicator role has yet to be defined in terms of sector experience, questions are being asked as to the impartiality (or influence being exerted on) members of the commission sitting on the panel, and the true nature of these panels has not been definitively defined.

 

The DCMS and their Consultations

The DCMS haven’t missed out on the action either, with several major consultations released since the white paper.

The first proposed a stake limit of between £2 and £15 per spin and slot-specific measures to give greater protections for 18 to 24-year-olds. The second related to a series of interesting measures to be introduced for the land based sector. Between a relaxation of casino rules and a potential change to the 80/20 rule for gaming machines, this could be a game changer for the land based operators.

These consultations closed back in October and we’re all waiting with baited breath to see what the responses will be… Some sources are suggesting the response on the proposed stake limit might even be released this week.

The final consultation, applying to all operators, concerns the statutory levy. This looks to be implemented towards the end of this year and generally requires between 0.1-1% from all operators. Funds will go towards research, prevention and treatment – not dissimilar to the previous system which oddly enough is the subject of a separate GC consultation proposing its revocation.

 

Overall these consultations tell us a lot about the general direction the Commission is moving in, with a lot of focus on the protection of customers from gambling harms and a tightening on all general regulatory powers. Until we start to see more responses coming in we won’t know just how much of these will be implemented, but we can expect there to be an awful lot of changes to come for both the land based and online sectors in the coming months.

It is advisable for all operators to start to review their internal procedures over the coming months to ensure they are ready to handle these changes, particularly any social responsibility and customer interaction procedures and internal management structures.

For further information on any of the ongoing or closed consultations contact amanda@woodswhur.co.uk or your usual Woods Whur contact.

The Government is consulting on whether to allow digital identities and technology to play a role in age verification for alcohol sales, as well as whether to amend legislation in order to specify that for sales of alcohol that do not take place face to face, age verification should take place at the point of delivery as well as sale.

The Government are considering whether the Licensing Act (the Act) adequately covers transactions that do not take place face to face. Currently the Act only sets out a requirement to verify age at the point of sale or appropriation to a contract, not at the point of delivery. They are therefore reviewing whether this is still right and whether there should additionally be checks at the point of delivery and / or service.

The options also consider checks to establish that an individual is not already intoxicated, and checks that a sale is not a proxy sale must take place at the point of sale/appropriation to a contract and also at the point of delivery/service.

In terms of technology, it is not just digital ID that is being considered, but also age estimation technology, that could be used to establish if an individual is of an age that allows them to legally purchase particular products.

These particular concerns have arisen due to the huge rise of delivery services, not only with door step services from supermarkets but also take away food delivery services.  The key driver is the protection of children from harm, meaning that alcohol must not be sold to someone under 18.  All must be done to ensure that alcohol does not fall into the wrong hands.

To have your say,  the full consultation document and please follow the link:

https://www.gov.uk/government/consultations/alcohol-licensing-age-verification/alcohol-licensing-age-verification

The consultation closes at 23:59 on 30 March 2024. Please do reach out to Chris Rees-Gay or your usual contact in the Woods Whur team, should you wish to discuss this further.

At our final solicitors meeting of the year we were looking at topics for end of year newsletter. I said I would do a review of 2023 looking forward at the same time to 2024. I am sure we say it every year but as we approach 2024 we all said that the year has flown by so quickly, and we have seen some significant changes. As I am finalising this I have just seen that it is 9 years today since the first review hearing for fabric. What a journey that was with a successful appeal, summary review and then settling the next appeal by consent order. fabric has gone on from strength to strength and survived Covid lockdowns and uncertainty. We went from a space where the Police were desperate to close the premises, to a safe environment where people can express themselves and young musical talent can flourish. Thank goodness we were able to persuade Islington of the importance of the venue.

It is interesting to look back at this as we analyse what 2023 has seen. There seems to be a greater swing towards enforcement again. It goes without saying that some enforcement is necessary, if there are rogue operators who are creating issues by not promoting the licensing objectives, then they can expect nothing more than being looked at closely. What we need to see is a graduated response so that operators who have built up years of goodwill can put right any issues which may have slipped. Enforcement proceedings in Leeds for example are significantly higher than we have seen for years with a large operation attacking off-licences in the her Harehills area of Leeds. We are instructed in some of these reviews and it’s going to be interesting to see how they are dealt with by the licensing sub-committee.

One of the areas that we have seen huge increases in this year is the number of appeals. I currently have appeals in Leeds, Swindon, Bristol, Hackney and several at Thames magistrates Court. There appears to be a significantly larger number of Licensing Act appeals than I have seen for a number of years. This is where we are in difficulties as some Magistrates Courts have an inability to deal with these appeals in a reasonable timescale. Some courts are clearly struggling and are not processing Licensing matters as quickly as they should because they are deemed to be non-urgent matters.

Another of the areas where we are seeing increased appeals is arising out of noise abatement notices. They appear to be a tool that are being used much more frequently than previously. I have a current set of circumstances were an abatement notice was served. We lodged an appeal against that and prior to the case management hearing we agreed a course of action with the authority in such a way that the appeal was settled by a consent order. Rather surprisingly after one further noise complaint another abatement notice was issued which is now the subject of the second appeal. I do feel in those particular circumstances a mediated approach, which my clients are keen to offer, would have saved everybody a significant amount of time. This is at a time when some operators are fighting for survival and many local authorities struggling to offer the services they want to due to reduced budgets.

One area that I have seen a willingness to assist responsible operators in is the relaxation of the controls of cumulative impact policies/stress areas in some key locations. This has led to the development of a brand-new £2.5 million award-winning premises in Nottingham which probably would not have been granted prior to the parking of he cumulative impact policy. The same operator has managed to secure a new licence in Newcastle in the stress area and against significant opposition and is now opened having spent £2.5 million pounds on the refit of refurbishment of another listed building. It is hoped that a sensible approach will continue to be taken to support the leisure industry which is still struggling having had all of the pressures of Covid lockdowns, train strikes and the fact that people have less disposable income at their fingertips currently.

It is good news that in August of this year the pavement licensing relaxations were granted an additional 12-month extension, valid until 30 September 2024. This was about as swift an about-turn as we have ever seen and the trade will be hoping that policymakers see the light and grant a permanent extension to the rigid regime prior to 30 September 2024 cut-off date.

Changes in the gambling sector have been frustratingly slow. We waited for what seemed like forever for the white paper to be announced highlighting the potential for changes to the Gambling Act. There was a flurry of activity amongst operators as we started to look at the potential implications of the changes suggested. However, we have now been slowed down by the number of consultations that are taking place and a lack of drive to get to the finish line. Operators that I deal with are becoming frustrated at the amount of time it is taking to get certainty. Some of the consultations still have time to run and if you want assistance in putting in your views then please contact me.

One of the areas which may impact in to all premises next year is “Martyn’s Law”, more officially known as the Terrorism (Protection of Premises) Bill. This featured in the King’s Speech and forms part of the Government’s legislative programme for the coming Parliamentary year. The Draft Bill aims to place a duty on qualifying public premises or events to take certain steps to reduce the threat of terrorism to the public. I have to say that I hadn’t paid enough attention to this until I listened to a presentation at the IOL National conference. It has the potential to make a huge impact and needs to be carefully followed, it is something that needs to be monitored as it goes through Parliament.

Finally, the Section 182 Guidance has recently been amended to include information regarding spiking, the full Revised Guidance can be found here –

Revised Guidance issued under section 182 of the Licensing Act 2003 (publishing.service.gov.uk)

With the mix of potential changes for next year we are sure that 2024 will be an interesting year to be involved in the licensing world. All at Woods Whur wish you a very Happy Christmas and for a great New Year.

A Deferred Prosecution Agreement was reached on 05 December 2023 between the CPS and Entain PLC relating to the historic investigations of HMRC into allegations of bribery.

A financial penalty and disgorgement of profit totalling £585 million, a charitable payment of £20 million, a costs order of £10 million…. Along with an agreement to exit all gambling markets which are not yet subject to gambling regulation.

Whilst the eye watering financials of the Deferred Prosecution Agreement between the CPS and Entain PLC (“Entain”) are capturing the attention of most, the online gambling operators will be far more concerned by this accompanying agreement to exit the grey markets. This includes Brazil, Chile, Peru and Mexico, as well as any market where gambling is not currently lawful as a matter of local or EU law.

 

The Underlying Case

The case relates to alleged failings of Entain during the period July 2011 to December 2017. At the time the company was named GVC Holdings and the primary allegation was the failure to prevent bribery occurring in one of the unregulated markets Entain operated in; Turkey. Kenny Alexander was the Chief Executive of GVC for 13 years, stepping down in 2020, and an investigation into corporate wrongdoing and bribery by the HMRC relating to the Turkish subsidiary, Sportingbet, occurred during his tenure.

The HMRC investigation began in 2019, with a primary focus on tax concerns, however, in 2020 the scope of this investigation was widened to include potential corporate offending under section 7 of the Bribery Act. This continued for three years, with Entain admitting in 2023 that there may have been historical misconduct relating to employees and third-party suppliers of the company.

Online gambling is illegal in Turkey, and GVC had allegedly been using a variety of methods to continue their operations in spite of this, including cash collection networks and payment processes which would conceal the transaction from the local financial institutions.  Sportingbet was sold in 2017 in time to be out of the picture before the Ladbrokes deal went though.

With this in mind, it is perhaps not surprising that the CPS have sought this agreement not to operate in the grey markets alongside the financial penalty. In many ways it is logical, a responsible operator would think twice about providing gambling in a country where there is no regulation – or it would even be illegal to do so. But taking the first of these two, what jurisdiction does a country have over the gambling laws of another?

What are the Grey Markets?

In simple terms, there are three gambling markets across the world. White markets are those with thorough regulation, often wealthy countries with robust regulatory systems in place. Great Britain, several US states, Malta, Gibraltar, Isle of Man and Curacao are all examples of white markets, albeit some more reputable than others. The black market contains jurisdictions which prohibit gaming. This tends to include countries in Asia and Africa with large Muslim majorities, as well as some European countries like Albania. The grey markets are more complicated.

The grey markets encompass jurisdictions where gambling is not strictly illegal, but there is no real regulatory system in place to manage it. Grey markets include Thailand, South Africa, Nepal, Niger, Rwanda, Morocco, Madagascar and Ethiopia. Some grey markets can be an attractive option for online operators, but they are not without risks – both financial and regulatory.

There can be some confusion about what different licences allow an operator to do. To take for example a  Gambling Commission (Great Britain) licence. This operating licence, depending on the type, will allow an operator to provide certain facilities for gambling to customers in Great Britain. There is nothing in the Gambling Act 2005 which specifically limits this provision solely to British customers (noting the exception of section 44 relating to prohibited territories).

The Gambling Commission themselves have stated:

“Ultimately, The Gambling Commission does not provide a list of jurisdictions outside Great Britain that licensed operators can or cannot provide gambling services to…. The Commission expects operators to conduct their own due diligence and put controls in place to ensure they meet legal requirements in other jurisdictions”.

This leaves operators open to take the risk. Many other jurisdictions (the white markets) have their own regulatory systems and to provide facilities for gambling to these markets without a local licence would be illegal in that country- regardless of holding a Gambling Commission licence. But the grey markets are a whole different story.

 

Why does this matter?

There are numerous online operators who utilise the grey markets as part of their businesses. They are interesting, innovative and often attractive markets. Many operators have found it to be beneficial to be an existing operator in an emerging market, more recently for example, the Netherlands and Ontario.

However, it is important to keep sight of why the regulations are important. Protection of customers and finances, keeping crime out of gambling and keeping gambling fair and open are all pillars of gambling which we might take for granted. The regulators within the white markets are unlikely to look at operators providing gambling in the grey markets all too kindly; for reasons ranging from integrity to tax implications. Furthermore, most will have systems in place to discover where its operators are marketing, in Great Britain the regulatory returns filed annually will show the Gambling Commission all markets being operated in.

So now there is an agreement in place between the CPS and Entain that Entain will not operate within the grey markets, breach of which will result in continued prosecution. However, without this agreement, would such an imposition be enforceable? It has been attempted previously, with regulators using what powers they have, but rarely is it successful. The only card a regulator can play is ‘you can’t play with us if you’re playing with them’. But when every online operator licensed in a certain jurisdiction is also operating in the grey markets,  these threats don’t have much weight. Would they really ban everyone?

The full DPA is available here – Rex v Entain PLC – Deferred Prosecution Agreement | The Crown Prosecution Service (cps.gov.uk)

For more information contact Amanda Usher or your usual Woods Whur contact.

The Government is consulting on whether to relax licensing hours nationally to mark certain matches of the 2024 UEFA European Championships (“Euro 2024”) or whether to rely on the existing system of Temporary Event Notices (TENs).

The proposal is to extend licensing hours if any of the men’s national football teams of England, Wales and Scotland is successful in reaching the semi-finals of Euro 2024 and if any of those teams subsequently reaches the final of that tournament. Any extension would relate to the sale of alcohol for consumption on the premises only and the provision of late-night refreshment in on-trade licensed premises; it would not apply to regulated entertainment. The extension would be to allow trade until 0100hrs the morning after the matches have taken place.

The purpose of any national relaxation of licensing hours during Euro 2024 would be to enable all pubs and other on-trade premises to sell alcohol and late night refreshment to people watching the relevant matches live.

For the full consultation document please follow the link: https://www.gov.uk/government/consultations/extending-licensing-hours-for-uefa-euro-2024-matches/contingent-relaxation-of-licensing-hours-during-the-semi-final-and-final-of-the-2024-uefa-european-championship-accessible#the-proposals

The on-trade needs as much help as it can get in the current economic climate, and so the extension of hours will be welcomed by the trade.  Should you as an operator wish to have longer hours than are being proposed, or wish to have regulated entertainment also, please do reach out to Chris Rees-Gay or your usual contact in the Woods Whur team, who can assist with the submission of a TEN.

 

We final saw a new revision to the Section 182 Guidance document issued by the Home Office just before Christmas. It was April 2018 when we had the latest revision of the Section 182 Guidance document. This has been the longest gap since the Section 182 Guidance document has been revised.

Just a reminder as to why this is an important document – Section 4 of the Licensing Act 2003 stresses that in carrying out its functions, a Licensing Authority must “have regard to” guidance issued by the Secretary of State under Section 182. To this effect, the guidance is binding on all Licensing Authorities. To depart from the guidance could give rise to an appeal or judicial review, and therefore any reasons for departure need to be given clearly.

This is a key document which licensing lawyers will refer to, along with any localised Statement of Licensing Policy, before drafting and submitting an application. It will also be referred to in licensing hearings before Licensing Sub-Committees, and also on appeals before the Magistrates’ Court.

For all of the above reasons, it is important to understand the implications of this document, and therefore any changes that have happened in this new revision.

The key changes are set out below in the running order of the document.

Entitlement to Work in the UK

This section of the guidance has changed, and needs to be considered. Paragraphs 4.8 – 4.48 replace paragraphs 4.8 – 4.18 under the previous guidance. There are significant changes to the ‘Entitlement to Work’ section in the document, and much of this reflects the change in relationship between the United Kingdom and the European Union/  European Economic Area. There are extensive changes which are pointed out in this expanded section, which need to be carefully considered when dealing with non-UK applicants.

Relevant Offences

Paragraph 4.51, which dealt with relevant offences under the 2018 edition, has been expanded to paragraphs 4.81 – 4.84 in the new edition. This introduces section 19 of the Criminal Justice and Police Act 2001, dealing with closure notices.

Temporary Event Notices – Section 7

There are some changes to the ‘Temporary Event Notice’ section within the document.

Paragraph 7.15, in the bullet points, refers to the increase in the allowance of temporary event notices from the year 2022 to 2023, which will increase from 15 to 20 per calendar year. This also increases for the same time period onwards, the total duration from 21 to 26 days per calendar year.

In addition, in paragraph 7.34, it is clarified that there is no ability for an appeal in relation to a late temporary event notice, following objection by the Police or Environmental Health Officer. The event is invalid and cannot go ahead.

Full Variation Process

Paragraph 8.76 has been amended to include the phrase “vary substantially the premises to which the licence relates.” This is an interesting addition to the full variation process, suggesting that if there are to be a substantial change to the premises, there should be a new licence application rather than a full variation. We are always keen to go down the route of a new licence anyway, rather than go down a variation route, as this removes the ability for additional conditions to be attached to a premises licence, without the benefit of the variation sort.

Conditions Attached to a Premises Licence

The wording of paragraph 10.5 has been changed to read “it is not acceptable for licensing authorities to simply replicate the wording from an applicant’s operating schedule. A condition should be interpreted in accordance with the applicant’s intention, and be appropriate and proportionate for the promotion of the licensing objectives.” This is a neater wording of the change to the previous paragraph 10.5

Planning and Building Control

A new paragraph has been added at 14.66, which states “where there is an application for planning permission, the National Planning Policy Framework expects new development can be integrated effectively with existing businesses and community facilities (such as places of worship, pubs, music venues and sports clubs). Existing businesses and facilities should not have unreasonable restrictions placed on them as a result of development permitted after they were established. Where the operation of an existing business or community facility could have a significant adverse effect on a new development (including changes of use) in its vicinity, the applicant (or “agent of change”) should be require by the local planning authority to provide suitable mitigation before the development has been completed.

It is encouraging to see that the “agent of change” principle has been added in to the statutory policy.

All in all, there are some interesting changes in the new revised guidance, which need to be considered when involved in the licensing process.

The Licensing Committee for the City of London has launched a new code of good practice. They have announced the new code stating that it is aimed at helping licensed premises achieve “the very best of outcomes for patrons and themselves, as footfall continues to rise following the pandemic.” The document can be found at: https://news.cityoflondon.gov.uk/city-pubs-bars-and-restaurants-offered-new-code-to-help-them-thrive/, and makes good and interesting reading.

This document has now been agreed by the City of London Corporations Licensing Committee, as they aim to boost the economy in the square mile, hoping that pubs, clubs, bars and restaurants will use it as a guide and flourish. This document aims to build on the City of London Corporations flagship (destination city) initiative which was launched in May 2022, aiming to transform the leisure offer to create a leading 7 days a week destination for UK and international visitors, workers and residents.

The aim of the good practice guide is to enable the square miles daytime and night time economy to grow, while ensuring that the potential impacts on residents, visitors, workers and emergency services are minimised. Chair of the City of London Corporations Licensing Committee, James Tumbridge said: “a night time economy is key to our recovery and we want to support premises that are enjoying increasing footfall and spend. Making people feel safe and welcome is all part of boosting our attractiveness as the place for work and leisure. Successful businesses are not successful by accident – they are well managed, comply with regulations, employ well-trained and dedicated staff, and offer a warm and safe welcome to customers.”

I have now had an opportunity to look at the new code of good practice, which echoes a similar approach taken by the City of London in 2013.

The aims of the code are set out in sections 3 and 4, and establishes a proactive approach to be taken by the regulatory authorities in City of London. This should give new operators, or operators wishing to change their style of operation, a clear steer on what they need to do to engage with the responsible authorities to reach their desired aims. It is certainly something we would consider carefully before lodging a new application or significant variation to an existing premises licence.

The City of London also operates a good practice accreditation scheme for licensed premises known as ‘Safety Thirst.’ This gives the operator the ability to benchmark themselves against the City of London’s expectations, to see whether they can reach accreditation level, to be commended or highly commended. Again, this is a very helpful tool for operators who want to reduce the risk of negative interaction with the regulators once they are trading.

Section 5 of the document gives guidance as to what the Authority expects to see as good practice for the general promotion of all four of the licensing objectives. This document is a good pro forma for assessing what you would expect to see from a responsible operator in their jurisdiction. I take the view that it is a good approach to have, as it gives a clear understanding of the approach to be taken by the Licensing Authority. If any operators would appreciate assistance or guidance in relation to the policy, or applications to be made in the City of London, we would always be delighted to assist.