High Court rejects legal challenge against reforms to remote gambling regime

Out-Law News | 10 Oct 2014 | 12:32 pm | 2 min. read

A legal challenge against UK government plans to reform remote gambling regulation and licensing in Great Britain has failed.

The High Court rejected the case brought by the Gibraltar Betting and Gaming Association (GBGA) which represents a number of Gibraltar-based gambling operators that deliver remote gambling services to consumers in Great Britain.

The Department for Culture, Media and Sport (DCMS) said the reforms, which were finalised earlier this year but were delayed as a result of the GBGA's judicial review case, will now become effective from 1 November 2014.

"We welcome the judgment," a DCMS spokesperson said in a statement. "We now look forward to the commencement of the Gambling (Licensing and Advertising) Act on 1 November, which will strengthen protection for consumers in Britain by ensuring that all remote gambling operators will be subject to robust and consistent regulation."

The GBGA said it was disappointed with the High Court's ruling.

"Cross-border regulatory regimes require significant co-ordination and co-operation on key legal and regulatory issues and the UK already had this with the Gibraltar industry, regulator and jurisdiction," the GBGA said. "We maintain this law is not in the best interests of consumers, the industry and the regulator itself and that there are more effective ways of dealing with the challenges of regulation and competition in this sector."

The GBGA said it is concerned that the Gambling Commission will not be able to effectively enforce the new rules on remote gambling in Great Britain. The Gambling Commission said the High Court ruling means it can "now … get on with improving the protection for those gambling in Britain".

Under the new regime, businesses wishing to advertise or provide remote gambling services to consumers in Great Britain will be required to obtain a licence from the Gambling Commission to do so. In connection with the new ‘point of consumption regime’, the Gambling Commission has already implemented a raft of changes to licensing conditions that remote gambling operators will have to adhere to. Further changes to the gambling software licensing regime do not take effect until 31 March 2015.

"We remain concerned the UK regulator will find it difficult to hold companies to account in jurisdictions outside of the EU where it has no legal powers and common legal framework or culture," the GBGA said. "Given this judgment there is now even greater need for an EU legal framework for online gambling if we are to effectively protect all European consumers, enjoy a common market and avoid each member state deciding alone how to deal with an activity that naturally crosses borders."

When the GBGA announced that it had lodged its application for a judicial review of the changes to remote gambling regulation and licensing in Great Britain in August, it described those changes as "illegitimate, disproportionate and discriminatory … and irrational". It claimed the reforms were being implemented for "economic reasons" and that they could actually be detrimental to consumers rather than improve consumer protection as the government has claimed.

The GBGA has maintained its preference for a new 'passporting' regime to be introduced which would allow remote gambling operators based overseas to promote and supply their services to British consumers if they abide by the local regulatory and licensing framework.

At the time, Peter Howitt, chief executive of the GBGA, said the Gambling Commission "has neither the resources, the legal powers, nor the skills to operate successfully across the globe" and that it was "laughable" for it to suggest it is better placed that Gibraltar's gambling regulator to regulate gambling operators based in Gibraltar.