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UK Gambling Act Review: What happens next?

Posted on 01 April 2021

On 8 December 2020, the Department for Digital, Culture, Media & Sport (DCMS) launched the review of the Gambling Act 2005 (the Act). The call for evidence closed at midnight last night. As the painstaking process of reviewing the responses begins, we look ahead to the coming months, examine some of the key areas that we consider to be central to the debate and outline what steps stakeholders should be taking to positively influence the ongoing debate and development of the law.

DCMS intends to publish its conclusions including any proposals for change in a white paper later this year. According to the Consultation Principles, DCMS should publish its response within 12 weeks of the consultation closing (which would take us to 23 June 2021). If this is not possible, DCMS should make a statement outlining the reasons why.

The white paper will provide a basis for further consultation and discussion with interested parties and, if it includes a draft Bill (which we consider unlikely), allow final changes to be made before the Bill is formally presented to Parliament. The next stage is therefore crucial as it will be the first time that DCMS will have to give a firm indication of its position on many of the key areas in the review. It will also give interested parties an opportunity to respond to the proposals and potentially to shape the direction of travel going forward. By all accounts, it is unlikely that any new primary legislation will come into force before Q1 2023 at the earliest. That said, depending on the nature of DCMS' proposals, certain changes could be implemented through secondary legislation or further changes to the Licence Conditions and Codes of Practice (LCCP), which could come into effect much sooner.

In addition to the key themes of the consultation, there are a number of related areas which we consider to be central to the wider debate and that we hope will be brought to the fore as part of the review. These areas are key to ensuring that any further legal or regulatory developments are both sensible and proportionate. Those areas are as follows:

  • Affordability: affordability checks are likely to be regarded as intrusive by many consumers, and it is important from a consumer rights perspective to establish whether regulatory interference in the freedom of individuals to buy services is necessary in a democratic society. It is important that any interference with consumer freedoms is justified and proportionate. Interference will not be appropriate if alternative, less-intrusive measures could be adopted instead. Given the extremely intrusive nature of affordability checks, there is a high bar to clear in order to establish not only that affordability checks are necessary and meet a pressing social need, but also that there are no alternative measures which could be taken instead. 
  • Single customer view: data sharing schemes of this nature, which the Gambling Commission is promoting to require gambling companies to share information regarding problem gamblers, give rise to a number of data protection, consumer rights and competition law concerns which must be carefully considered. For example, to what extent is it appropriate to share such data without the consent of the relevant individuals? Are there less-intrusive approaches which could be taken instead (such as raising consumer awareness regarding the existing self-exclusion schemes that are available).
  • Regulatory overreach: numerous significant changes have been made to the regulatory framework within which gambling companies operate in recent times. These changes have, for the most part, been introduced through changes to the LCCP but this would not be appropriate in relation to some of the changes proposed in the context of the Gambling Act review. In addition, it should be noted that the Gambling Commission is a regulator rather than a legislator, and its powers are appropriately limited. To the extent that the Gambling Commission does seek to make further changes to the LCCP, it is essential to ensure that the regulator acts within its statutory powers.
  • Good regulation: the obligations of licensees have developed at significant pace in recent times. Just as one change comes into effect, another is announced and there is little publicly available information or evidence indicating how successful such changes have been in reducing risks to the licensing objectives and/or gambling related harms. Evaluation is an essential component in achieving 'good regulation' and ensuring that the regulatory approach adopted by the Commission "does not impose unnecessary regulatory burdens in upholding the licensing objectives, and does not unduly hinder the economic progress of licensees" (as per the Commission's own Statement of principles for licensing and regulation dated June 2017). Change for change's sake will not lead to proportionate regulation.

Notwithstanding that the consultation has now closed, there is still much that stakeholders can do in order to positively influence the debate and the development of any new legislation in connection with the key themes of the consultation and the related areas outlined above. This is a long game and interested parties should take time to consider what their short, medium and long term objectives are and how they might be achieved. We would expect such a strategy to involve some or all of the following:

  • commissioning academic research/econometric evidence and other expert evidence to ensure that reform is evidence-led. Ideally, stakeholders should start gathering such data before the white paper is published;
  • devising and implementing a strategy for engagement with Parliamentarians to ensure that they fully understand the extent of the existing legal and regulatory framework within which licensees operate;
  • disputing unfounded claims in the press and sourcing and presenting counter-arguments with a view to creating a more balanced debate;
  • exploring ways in which the voice of the consumer might meaningfully be introduced into the current debate; and
  • campaigning for responsible regulation based on sound legal principles, challenging regulatory overreach, and ensuring that the rights of players (to choose what services they buy without undue state interference) are not overlooked.

There is still likely to be a significant opportunity for stakeholders to engage with the proposals and seek to influence the direction of travel, but further responses and engagement will need to be compelling and data-led in order to be persuasive.

The return of John Whittingdale MP as Minister responsible for gambling (who brings with him a wealth of sector experience and is thought to favour lighter touch regulation of the industry) and the resignation of Neil McArthur from his role as Chief Executive of the Gambling Commission will have buoyed the industry to a degree – but this development alone is unlikely to meaningfully impact the way in which the review develops. Even if the Act in its current form is ultimately considered broadly sufficient (notwithstanding comments that it is an analogue law in a digital age) the review provides a real opportunity for the industry to shift the dial and counteract anti-gambling sentiment. To really make a difference to the review, the areas outlined above and the future of the industry, a concerted effort is needed to advocate for good regulation based on evidence and sound legal principles. This favours a much more holistic approach (as opposed to the more 'transactional' or 'in the moment' approaches seen previously) and necessitates a continued commitment to raising standards to avoid providing scope for further criticism that regulators and industry critics may seek to use to justify more draconian regulation.

This article was written in conjunction with DRD Partnership

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