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Changes to UK gambling licence conditions and codes of practice

After having considered all the responses to the consultation on changes to the UK gambling licence conditions and codes of practice (hereinafter “LCCP“), the UK Gambling Commission has taken the decision to strengthen requirements on licensees in key areas.

The changes will clarify the outcomes licensees must deliver for consumers and provide a firmer basis to tackle those licensees who fail to deliver them. The changes relate to:

  1. marketing and advertising
  2. unfair terms and conditions
  3. the handling of customer complaints and disputes.

In particular, these changes provide, among others, the following:

More stringent obligations on marketing communications

The UK Gambling Commission insists in making sure that marketing communications for gambling do not mislead and are not targeted at vulnerable people. To this end, all marketing communications of gambling products and services must be undertaken in a socially responsible manner.

Likewise, for instance, the ban on marketing communications showing individuals under 25 years old (i.e. : those in the 18-24 age bracket) does not apply to point of sale communications provided that they depict the sport or the other activity that may be gambled on and not the activity of gambling itself.

Liability for instructed third parties

License holders are responsible for the actions of third parties with whom they contract for the provision of “any aspect of the licensee’s business related to the licensed activities.” In order to ensure a full compliance to the new provisions for the UK gambling license, licensees must ensure that the terms on which they contract:

  1. require the third party to be bound by the same conditions applicable to the UK gambling license and subject to the same codes of practice as the licensee;
  2. oblige the third party to provide such information to the licensee, as they may reasonably require in order to enable the licensee to comply with their information reporting and other obligations to the UK Gambling Commission; and
  3. enable the licensee to terminate the third party’s contract promptly if, in the licensee’s reasonable opinion, the third party is in breach of contract (including in particular terms included pursuant to this code provision) or has otherwise acted in a manner which is inconsistent with the licensing objectives, including for affiliates where they have breached a relevant advertising code of practice.

More control over unfair contractual terms

UK Gambling Commission introduced changes that make easier for customers to take action where a licensee does not respect rules concerning:

  • consumer notices;
  • changes to customer contracts;
  • unfair commercial practices at any stage of a customer relationship.

Licensees must ensure that the contractual terms on which gambling is offered – as well as any consumer notices relating to gambling activity – are not “unfair” and shall be “transparent” within the meaning of the UK Consumer Rights Act 2015. Licensees must also ensure that material changes to customer contract terms must be notified before they come into effect.

Obligations in handling complaints

Changes include the demand to handle complaints in a “open, timely and effective manner“, making clearer the status of the proceeding and providing information on “deadlock letters“. It means that the relevant complaint process could be considered ended only if:

  • either the customer’s complaint remains unresolved eight weeks after the licence holder received it;
  • or the customer and the licence holder reach a deadlock or final position in less than eight weeks

in this case, the final letter shall explain which is the final decision explaining how to escalate the complaint to an independent ADR entity, if players wish to do so.

The changes to the LCCP will be effective from 31 October 2018. As a consequence, there isn’t much time to act.