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Out-Law News 3 min. read

Gambling law updated in the UK for the internet

Culture Secretary Tessa Jowell yesterday published the main parts of a draft Gambling Bill, to revamp Britain's dated rules for the industry. It creates a new regulator, the Gambling Commission, and introduces a Remote Gambling Licence for phone and internet businesses.

Commenting on the draft Bill, Tessa Jowell said:

"Our gambling laws date back to the 1960s. Since then attitudes to gambling have changed and the law has failed to keep pace with rapid technological change. Gambling is now a diverse, vibrant and innovative industry and a popular leisure activity enjoyed in many forms by millions of people. The law needs to reflect that."

Accordingly, the draft Bill seeks to balance protection for children and vulnerable adults with the needs of the industry, particularly in light of the growth of the internet and other media which allow remote gambling.

The provisions published yesterday do not form the complete Bill, and have been published now to allow for what the Government calls "pre-legislative scrutiny".

Summary of general provisions

Gambling will be unlawful unless specifically permitted. Permissions will be granted by licence, permit, registration, or exemption, as provided by the Bill.

Offences are created of either providing or using facilities for gambling without appropriate permission. Each offence may result in a maximum of six months in prison or fine, or both.

Two types of gaming and betting are automatically permitted under the Bill: private and non-commercial gaming, and private and non-commercial betting.

The Bill also creates the Gambling Commission, a new, unified regulator, which will take over from the Gaming Board for Great Britain and carry responsibility for the licensing regime. The Commission will have powers to introduce Codes of Practice for the benefit of the industry. It will also have power to prosecute to enforce the licensing regime.

Licensing objectives will govern the granting of licenses. These are:

ensuring no link between gambling and crime or disorder;

ensuring that gambling is conducted fairly and openly; and

protecting children and vulnerable adults from harm or exploitation.

Those under 18 are not to be allowed to gamble. It is an offence to "invite, cause or permit" a child (under 16s) or young person (16 and 17 year-olds) to gamble, and if a young person does gamble, he is committing an offence.

Summary of rules on remote gambling

Remote gambling is defined as "gambling in which persons participate by the use of remote communication" namely, the internet, telephone, television, radio or "any other kind of electronic or other technology for facilitating communication".

Operators of gambling services based in Great Britain and using remote communication will need licenses that authorise such gambling. A single licence cannot be issued for remote gambling and non-remote gambling. An operator will have to obtain two licenses if he hopes to provide both services.

Any remote licence issued may contain conditions as to the method of remote communication that may be used, in addition to conditions particular to the operator concerned.

All offences created under the Bill are applicable to remote gambling, but there are certain points to note:

For the offence of providing facilities for gambling without appropriate permission to apply, a piece of remote gambling equipment (for registering, taking payment, presenting a virtual game, or determining a result) must be situated in Great Britain. If no such equipment is situated in Great Britain, then no offence is committed.

There is an exception to the offence of using premises for gambling without appropriate permission. This occurs where premises are used for providing facilities for gambling, but those facilities will never be provided to persons on those premises. Accordingly, operators of remote gambling services will not need a premises licence for premises where remote gambling equipment is sited, if no one will use the facilities on that site.

A separate offence will be committed where a person in Great Britain uses remote gambling equipment for the purpose of "inviting or enabling a person in a prohibited territory to participate in remote gambling". The Secretary of State will have powers to designate which places are prohibited territories.

The interactive Gaming, Gambling and Betting Association welcomed the publication of the draft. Online Casino News quotes Chairman Andrew Tottenham saying:

"The Bill will finally provide for the licensing of remote gambling operators and a proper regulatory framework, allowing for confidence in the integrity of a leisure activity that many consumers currently enjoy."

According to the Government, the draft Bill will now be scrutinised by a Joint Committee of both Houses of Parliament, and the remaining sections of the draft Bill will be published early next year. The final Bill will then be introduced as soon as Parliamentary time becomes available.

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