2023 Gambling Act White Paper: The new age of gambling regulation

The question

How far reaching are the proposed reforms of the Gambling Act and how will they impact digital platforms?

The key takeaway

The UK Government has introduced major proposals for the digital gambling space, including financial risk checks, transaction blocks for payments, restrictions on advertisements and raising the age limit for gambling both offline and online. These changes are seen to target businesses in the tech space and are expected to impact which advertisements are displayed, how payments are made and how age verification takes place online.

The background

The Gambling Act first came into effect in 2005. The gambling landscape has since changed substantially, marked by the introduction of multinational tech businesses into the space. On 27 April 2023, the Government published its White Paper on reform of the Gambling Act.
The White Paper proposes a series of changes pursuant to a review conducted by the Department for Culture, Media and Sport (DCMS). In this review, the DCMS highlights its aim to balance consumer freedom on one hand, and the protection from harm (especially of those at risk of addiction and the younger population) on the other.

The development

The White Paper introduces a multitude of proposals. Amongst other changes to land-based gambling, the following key changes are brought in specifically targeting the digital space:

• Protections in place targeting online gambling – the main proposal is a system to conduct affordability checks on individuals losing £1,000 within a day or £2,000 within 90 days. There are also proposals for the implementation of stake limits for online slot games, reviews of game speed for online games, an extension of gambling transaction blocks to online payment, as well as regulation over digital prize draws and competitions.
• Tougher restrictions on gambling advertising, sponsorship and branding – the White Paper suggests a further review from the Gambling Commission (Commission) of incentives such as free bets and bonuses and for online advertising of gambling to be directed away from children.
• Increase of the Commission’s power – there are also suggestions that the Commission’s licence fees should be increased and statutory levies be introduced for gambling operators so that the Commission has adequate resources to exercise extended powers, including compelling internet service providers and payment providers to stop providing their services to black market websites.
• Raise in age limit for gambling – following an increase in the age limit for the National Lottery to 18 years, the Government plans to increase the minimum age for other forms of gambling, including those online.

A further consultation is to follow which seeks contributions from industry stakeholders and participants in gambling during Summer of 2023.

Why is this important?

Though the series of reforms put forward by the White Paper are still subject to consultation and legislation pending Parliamentary timetable, the Government’s intention to regulate the online realm of the gambling industry is clear. Future legislation is likely to follow, putting the onus on businesses to implement practices in line with the directions of the Government.

Any practical tips?

Digital platform providers are also likely to be directly impacted by the tightening of regulations over gambling related advertisements and sponsorships and may become responsible for age verification online. They may also find themselves in positions where they may be asked to impose blocks on large transactions pursuant to the White Paper proposals. Providers should keep a close eye on this developing area of law and when the consultation opens, should consider communicating their perspectives.

Summer 2023