Out-Law News 2 min. read

Betting shops can only provide gaming machines alongside 'substantive facilities for non-remote betting'

Betting shops, bingo halls and casinos will face new restrictions on installing gaming machines on their premises under new licensing conditions finalised by the British Gambling Commission.

The new licence conditions and codes of practice (LCCP) (81-page / 1.43MB PDF), which will have effect from 31 October, will see the removal of the concept of 'primary gambling activity' and instead see the provision of gaming machines on premises regulated as part of gambling operators' social responsibility obligations.

Under the new framework, betting shops will only be permitted to install gaming machines in their premises if they also provide "substantive facilities for non-remote betting". Similar requirements to provide "substantive facilities for non-remote bingo" and "substantive facilities for non-remote casino games and/or games of equal chance … available in the premises" will apply to bingo halls and casinos respectively.

Each gambling operator will have to ensure there is "appropriate supervision" of their facilities for gambling by staff "at all times".

Gambling operators wishing to open a betting shop need to obtain both an operating licence from the Gambling Commission and a premises licence from the relevant local authority. The Commission issues non-remote operating licences to bookmakers who wish to take bets over-the-counter, and remote operating licences for those who offer online services (remote betting), such as on a computer or through self-service betting terminals situated in a high-street betting shop.

Under the current LCCP, non-remote betting licence holders can install up to four gaming machines in their shop only if the 'primary gambling activity' is betting.

Expert in gambling licensing Christopher Rees-Gay of Pinsent Masons, the law firm behind Out-Law.com, said "it is clear" that the Gambling Commission has introduced specific changes to the licensing regime to account for recent cases involving Greene King and Luxury Leisure Limited.

"The changes mean that the provisions are now ‘social responsibility code provisions’ which must be adhered to by all licence holders," Rees-Gay said. "Previously they were ‘ordinary code provisions’, which do not have the status of licence conditions. This change in itself will mean that the Gambling Commission will have more powers to enforce its views in this matter."

"There has been the total removal of the concept of ‘primary gambling activity’, which was subjective and difficult for the Gambling Commission to enforce. However, elements of the new provisions can also be seen as unclear in parts. I am certain there will be issues with the wording of new provisions. For example, no specific definition has been given as to what would constitute 'substantive facilities' for other types of gambling," he said.

Rees-Gay said that some of the new code requirements will concern gambling operators that run premises that provide for other activities beyond gambling, such as snooker halls that also serve as bingo halls.

He pointed to the fact that the new framework requires all non-remote bingo operating licence holders to ensure that "the function along with the internal and/or external presentation of the premises are such that a customer can reasonably be expected to recognise that it is a premises licensed for the purposes of providing bingo facilities". The Gambling Commission has said that "the function of the premises should also ensure that the sum of gambling activity is not ancillary to some other non-gambling purpose".

"This may create difficulty for some venues that are operating as both snooker halls and bingo facilities," Rees-Gay said.

A number of gambling operators will be affected by the "shift in the goal posts", said Rees-Gay, having been used to arranging their operations to meet the requirements linked to ‘primary gambling activity’. Rees-Gay said: "It will be interesting to see if the Gambling Commission will start to take enforcement action, when the new LCCP comes into force."

Other changes to the LCCP confirmed by the regulator include new rules on the placement of digital adverts by gambling operators. It has also placed non-remote lottery licence holders subject to the requirements to assess and manage money laundering risks.

All gambling operators will also face new obligations in relation to the prevention of crime associated with gambling too.

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