DPRRC/13-14/72
GAMBLING (LICENSING AND ADVERTISING) BILL
DELEGATED POWERS MEMORANDUM
Introduction
1. This delegated powers memorandum sets out the powers to make orders contained in the
Gambling (Licensing and Advertising) Bill.
2. The Bill extends the scope of the regulatory regime governing remote gambling under the
Gambling Act 2005. It also introduces an offence of advertising of unlicensed remote
gambling which will only apply in Northern Ireland.
Background
3. The 2005 Act introduced a new regulatory regime to govern the provision of gambling in
Great Britain and created a single regulator, the Gambling Commission. The general
approach under the 2005 Act is that a person who provides facilities for gambling must
hold an operating licence from the Gambling Commission, unless otherwise exempted. A
person who provides facilities for gambling without a licence as required commits an
offence under section 33 of the 2005 Act.
4. A ‘remote operating licence’ is required from the Gambling Commission to provide
facilities for remote gambling if (and only if) at least one piece of ‘remote gambling
equipment’ used in the provision of the gambling facilities is located in Great Britain.
Remote gambling means gambling in which persons participate by the use of ‘remote
communication’. This includes the internet, telephone, television, radio, or any other kind
of electronic or other technology for facilitating communication. The effect of this is that
remote gambling operators who locate all of their remote gambling equipment overseas
do not need a licence from the Gambling Commission, whether or not their remote
gambling facilities are used by British consumers.
5. The 2005 Act also regulates advertising of gambling services in Great Britain (for both
‘remote’ and ‘non-remote’) gambling. Section 328 of the 2005 Act empowers the
Secretary of State to make regulations controlling the advertising of gambling. To date no
such regulations have been made.
6. There are two general advertising offences in the 2005 Act: sections 330 and 331.
7. Section 330 makes it an offence to advertise unlawful gambling (by remote or non-remote
means). For the purposes of section 330 advertised gambling is unlawful if an operator
does not hold the required Gambling Commission licence for the gambling to take place
as advertised. In the case of remote gambling, the offence of advertising unlawful
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gambling applies if at least one piece of remote gambling equipment to be used in
providing facilities for the advertised gambling is situated in Great Britain (see section
333 (territorial application: remote advertising)).
8. Section 331 of the 2005 Act makes it an offence to advertise foreign gambling, whether
by remote or non-remote communication. ‘Foreign gambling’ means gambling which
either takes place in a non-EEA state (e.g. a casino in Australia), or gambling by remote
means which is not regulated by the gambling law of any EEA state. For the purposes of
this section, Gibraltar is treated as if it is an EEA state. The Secretary of State may also
make regulations specifying countries or places which are to be treated as though they
were EEA states for the purposes of section 331, known as the “White List”. There are
currently four places on the White List: the Isle of Man and Tasmania, the States of
Alderney, and Antigua and Barbuda. Gambling operators based in Gibraltar and White
List places are able to advertise their gambling services in the United Kingdom without a
remote operating licence from the Gambling Commission.
Clause 1: Licensing of remote gambling
9. Clause 1(2) extends the category of remote gambling operators who will need a licence
from the Gambling Commission. A remote gambling operator will need a licence from
the Gambling Commission if their gambling facilities are used in Great Britain (even if no
equipment is located here) and the operator knows, or should know, that the facilities are
being used or are likely to be used in Great Britain. If the operator does not obtain the
required licence, they will be committing an offence under section 33 of the 2005 Act.
10. Clause 1(4) confers a power on the Secretary of State to make provision, by statutory
instrument, about the making, consideration and determination of an “advance
applications” for a remote operating licence. Advance application is defined in clause
1(5) as an application for, or for the variation of, a remote operating licence that is made
in anticipation of the new requirement for a remote gambling licence coming into force.
An order under clause 1(4) may: (a) confer discretion on any person; (b) modify, apply or
replicate provisions of the 2005 Act; (c) make different provision for different purposes;
and (d) include an incidental, consequential, transitory, or transitional provision.
11. The reason for taking the power is to allow the Secretary of State to establish a process
for the making, considering and determining of new or variation applications before the
new requirement for a remote gambling licence come into force. It is being taken
supplemental to the commencement power in clause 5(5) (which includes a power to
make transitional etc. provisions). This is because it is anticipated that in establishing the
arrangements for the making, consideration and determination of advance applications, it
will be necessary to make provisions that go beyond the ordinary types of provision that
might be expected to be made pursuant to the common power to make transitional etc.
provisions contained in a commencement power (as detailed further below).
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12. As part of establishing an advance application process, discretion will need to be
conferred on the Gambling Commission as the regulator who will be responsible for
administering the arrangements adopted in relation to the making, consideration and
determination of advance applications.
13. Further, it is anticipated that it will be necessary to modify, apply or replicate provisions
made by or under the 2005 Act in establishing the advance application process. In
particular, provisions relating to the time for levying annual fees will need to be modified
to allow the new annual fee to become payable on the new or varied remote operating
licence from the date of issue (with provision for refunding annual fees paid on the old
licence where necessary).
14. The power to make different provision for different purposes enables different provisions
in relation to different classes of advance application (e.g. applications made on a
specified date or in a specified period). A power is also being taken to include an
incidental, consequential or transitional provision if necessary.
15. Orders made under clause 1(4) are subject to negative resolution procedure. This includes
an order which includes a provision modifying a provision made by or under the 2005
Act. A negative resolution procedure has been adopted for the reason that an order made
under clause 1(4) is limited to making provision in respect of the making, consideration
and determining of advance applications. Therefore any changes that may be made to the
2005 Act will only apply for the limited purposes of making, considering or determining
advance applications. Clause 1(4) does not allow an order to be made which would
permanently change any of the provisions made by or under the 2005 Act.
Clause 2: Advertising of foreign gambling
16. Clause 2(1) repeals section 331 (offence of advertising foreign gambling) and makes
consequential amendments to certain provisions in the 2005 Act. The repeal of section
331 will remove the power conferred on the Secretary of State by section 331(4) to make
regulations specifying places to be treated as though they were EEA states for the
purposes of section 331 i.e. the White List, which is discussed in paragraph 8 above. The
effect of this will be to abolish the White List.
17. Clause 2(2) makes minor consequential amendments to sections 332, 333 and 361 of the
2005 Act.
18. Clause 2 does not confer any delegated powers.
Clause 3: Advertising of gambling by way of remote communication
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19. Clause 3 makes amendments to section 333 of the 2005 Act. Section 333 sets out the
territorial application of the advertising provisions in the case of advertising which is
done by remote communication (called ‘remote advertising’ in the 2005 Act).
20. Clause 3(2) removes an anomaly in section 333(2)(b) in relation to television advertising.
Currently a television broadcaster or service provider who is under the jurisdiction of an
EEA state can advertise unlawful gambling in the United Kingdom that they would
otherwise be prohibited from doing by section 330 of the 2005 Act. The amendment will
ensure television broadcasters and service cannot advertise unlawful gambling.
21. Clause 3(3) amends section 333(9)(b), which will extend the application of the offence in
section 330 of advertising unlawful gambling, in the case of remote gambling, to
operators whose remote gambling facilities are capable of being used in Great Britain.
The effect of this amendment is that a remote gambling operator will commit the offence
of advertising unlawful gambling if their facilities are capable of being used in Great
Britain and a remote operating licence is required for the gambling to taken place as
advertised, but the operator does not have a licence.
22. The amendment of section 333(9)(b) will also mean any regulations made under section
328 in relation to advertising by remote means, will apply to remote operators whose
facilities are capable of being used in Great Britain (in addition to the other
requirements). To date no such regulations have been made.
23. Clause 3 does not confer any delegated powers. It only amends the test for determining
the territorial application of any regulations that may be made under the section 328 of
the 2005 Act.
Clause 4: Offence of advertising unlicensed remote gambling: Northern Ireland
24. Clause 4 creates an offence of advertising unlicensed remote gambling which will only
apply in Northern Ireland. The effect of this amendment is that a remote gambling
operator who does not hold the required Gambling Commission licence will not be able to
advertise remote gambling in Northern Ireland.
25. Currently the law in Northern Ireland does not regulate remote gambling or the
advertising of remote gambling. The repeal of section 331 in Northern Ireland would
therefore mean that remote gambling operators could advertise remote gambling in
Northern Ireland, regardless of whether they were regulated in Great Britain (or in any
country). The new offence will bring Northern Ireland back into line with the position in
Great Britain, as it will extend the same protection that applies to British consumers in
relation to advertising unlawful gambling (section 330) to consumers in Northern Ireland.
Clause 4(3) replicates the same protections that currently apply in relation to remote
advertising in the 2005 Act (see section 333(4)). A person guilty of an offence of
advertising unlicensed remote gambling is liable on summary conviction to imprisonment
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for a term not exceeding 6 months, a fine not exceeding level 5 on the standard scale, or
both.
26. This clause does not confer any delegated powers.
Clause 5: Extent, commencement and short title
27. Clause 5(4) provides that clauses 1(4) to (7) of the Bill will come into force on the day on
which the Act receives Royal Assent.
28. The other provisions of the Bill come into force in accordance with a commencement
order under clause 5(5). The Secretary of State may commence the provisions of the Bill
on different days or for different purposes. A commencement order may also contain
consequential, transitory, transitional or saving provision (clause 5(6)). An order made
under subsection (5) is not subject to any parliamentary procedure as is ordinarily the case
for commencement orders.
Department for Culture, Media and Sport
30 April 2013