On April 27th, the UK Government finally issued the long-expected White Paper on its planned and much-delayed overhaul of the country’s gambling sector aimed at making the regulation of the £14-billion-a-year industry more fit for the digital age. British lawmakers have also shared that the reforms are designed to prevent problem gambling.
The publication of the White Paper on gambling follows two and a half years of work under the lead of four successive culture ministers after being officially announced in December 2020. The legislative and regulatory proposals were waiting for the Prime Minister’s signature for almost a year but, as Casino Guardian previously reported, the process was delayed by the political crisis caused by the collapse of PM Boris Johnson’s Government.
Since Mr Johnson stepped down from the position, the UK has named two successive Prime Ministers, with the ministerial appointment re-shufflements putting the regulation proposals off every time.
Online Machines Stake Limits, Stricter Background Checks and New Mandatory Levy among the Proposed Measures
On Thursday, the country’s Culture Secretary Lucy Frazer issued a statement, saying that the proposed rules are set to reduce maximum bets, require more customer background checks, and roll out a tax aimed at funding education, research, prevention and treatment of gambling addiction. Ms Frazer confirmed that the Government plans to roll out a series of consultations on the proposals starting in the summer.
As reported by Casino Guardian earlier this week, British lawmakers plan to relax the rules on brick-and-mortar casino venues by providing them with the opportunity to host more gambling machines.
The implementation of special background checks for customers who lose £125 in a single month, or £500 in a year, as well as more detailed checks for players who have lost £1,000 in 24 hours or £2,000 in 90 days, is among the major proposals included in the UK Government’s White Paper. Furthermore, the legislators would seek to authorise a cross-operator harm prevention system with data sharing between gambling companies as an effective way to prevent problem gamblers from quickly changing operators in order to circumvent the restrictions. Also, online slot machine stakes are set to be limited to between £2 and £5.
A mandatory levy estimated at 1% of their overall revenues will have to be paid by gambling operators. The country’s gambling watchdog – the UK Gambling Commission (UKGC) – is set to receive more money to carry out its regulatory work.
The industry is also likely to be forced to review the design and targeting of its incentives, such as bonuses and free bets, aimed at attracting new players to their services.
As previously discussed by Members of Parliament, the White Paper also focuses on the establishment of the figure of an independent ombudsman for customer redress.
UK Gambling Giants Focus Overseas to Compensate for Tougher Regulation on Their Domestic Market
Currently, the UK hosts some of the largest gambling companies on a global scale, such as Flutter Entertainment, Entain, and 888 Holdings. But even the size and significant annual revenue generated by these operators are not always able to compensate for the stricter regulatory regime in the UK and its effects on their business performance.
On the other hand, the opening of the US sports betting market in 2018 has seen European gambling companies target an overseas expansion, seeking to strike agreements on multi-billion deals with US competitors in return for years of experience in regulated markets.
According to the White Paper unveiled by the Government, the gross gambling yield of the industry suffered a massive blow estimated at between £329 million and £812 million, with the dangers originating from the stricter evaluation of financial risks and so-called affordability checks.
Some experts claim that the years leading to the much-awaited announcement of British lawmakers’ White Paper on gambling have seen some of the largest gambling operators in the country already put certain measures in place to respond to the need for further restrictions.
Some of the measures in question include a recently-announced voluntary ban on gambling sponsorships that would prevent English Premier League (EPL) clubs from displaying the names and logos of their gambling company partners on their shirt fronts. Reduced gambling advertising during live sports events aired on TV, a voluntary levy paid by the largest gambling companies, and trials on online stake limits have also been among the measures unveiled by operators in the wake of campaigners’ calls for stricter regulation.