On September 14, 2023, the United Kingdom Gambling Commission (UKGC) announced that it would establish a new Industry Forum to bridge the gap between the Commission and industry operators. As Britain’s primary regulator of gambling, the UKGC has a uniquely vested interest in fostering an open dialog with operators.
Breaking Down Barriers
No matter the industry, regulators will always face pushback from insiders. This back-and-forth is a normal part of any negotiation and forms the bedrock upon which all regulations are built. While this dialog is ideally done in good faith, it unfortunately often turns into an “Us vs. Them” mentality with both sides forgetting that they are supposed to serve the public instead of their own interests.
Preventing this communications breakdown is vital to ongoing, effective regulation and by giving industry operators a seat at the table, the UKGC has taken a bold step towards building a lasting and meaningful connection to the sector it’s tasked with regulating. Chair of the UKGC, Marcus Boyle, explained the situation as he sees it:
“We’ve always listened to the views of the industry when deciding how best to make progress but this new forum will give us another way to work with representatives from the industry we regulate.”
Building Bridges
The UKGC’s Forum will be composed of a wide range of stakeholders in the gambling industry, giving them a clear avenue for sharing their views, experiences, and concerns directly with those in a position to act. This level of immediate communication will provide regulators with an unprecedented understanding of the challenges and opportunities faced by the industry.
This degree of openness is more important than ever as recent advancements in things like esports and online gambling have only continued to increase in popularity. At the same time, legislation is slow and often fails to keep up with the times. The most recent gambling laws passed at a national level in the UK were set out in the Gambling Act of 2005. In the last 18 years since the law’s passage, it has been updated and amended, but this is a lengthy, complicated, and often expensive process.
By adopting agreed-upon guidelines, industries have the potential to create meaningful and lasting regulations without the need for cumbersome legal work. As an example look at the Motion Picture Association of America (MPAA), the organization responsible for movie ratings in the US. There is no legal requirement for a film to be rated in the USA, but, thanks to a long-standing agreement between industry executives and federal regulators, filmmakers voluntarily submit their films for review and ratings by the MPAA. This allows the government to focus on more important matters while giving the film industry a chance to reevaluate thots rating systems as times and norms change.
A gambling industry with this degree of cooperation with regulators and voluntary self-oversight would become much more flexible and sustainable. CGL (Curacao Gaming License) has become a prime example of how things could work, as one of the well-established operators just recently opened up their latest casino under it, Rooli Casino, knowing they’ll get the full support, even with crypto-based projects.
Staffing the Board
So, who will these select stakeholders be? That remains to be seen. As mentioned, there will be a number of operators called upon, but they won’t be the only voices in the room. Also present will be advocates for safe gambling and representatives from the UKGC’s Digital Advisory Panel. In total, the Forum should contain ten members and will be headed by a Chair who will be given a three-year mandate. Recruitment for the board and chair was scheduled to begin in September 2023 and is currently ongoing.
A Healthy—But Shifting—Landscape
The decision to form the Forum came just two weeks after the UKGC released its FY 2022/2023 Industry Performance Report and new decisions announced have to be looked at through this lens. It’s no secret that the last few years have been challenging for the gambling industry but the Commission’s report paints an overall healthy picture of a recovering sector.
Of particular note in the report is the rate of online gambling compared to in-person. In the year leading up to March 2023, 27% of Britons reported in-person gambling while 26% reported gambling online. While the overall volume of online gaming dropped 6.2% from 2021-2022, it is still up 12.4% from the fiscal year ending in March 2020. Clearly, online gambling is here to stay and any new regulations or legislation will need to keep this in mind. As mentioned earlier, the new Forum will feature members from the Digitial Advisory Panel so it seems like the UKGC is ready to actively embrace online gaming.
The growth of online gambling is just one sign of overall growth in the market. From 2021-2022, the UK gambling industry pulled in £14.1 billion—an 11% increase from the previous year.
A Two-Way Street
All the regulation in the world means nothing without enforcement, and the UKGC’s report addresses this as well. Over the last year, the UKGC has taken action against 24 operators found to be in violation of existing regulations. In total, actions against non-compliant operators totaled a staggering £60.1 million, including a record £19.2 million sanction against William Hill Group for several failures to ensure player well-being.
Cards on the Table
What does all of this mean for the gambling industry? Well, it’s simply too early to tell. With no word on who will serve on the Forum or what sort of mandate they will have, all that operators can do is sit and watch. Overall, though, there is reason to be optimistic. The fact that the UKGC is actively inviting industry insiders to collaborate with public safety officials and the new Digital Advisory Panel, it seems that the government is finally ready to make some sweeping changes to its antiquated laws.
At the end of the day, it’s always better to have a seat at the table than to be on the outside looking in. The gambling industry needs to bite the bullet and accept that there will be new regulations just as the government will need to accept that things like online gaming aren’t going anywhere. Only with all sides can sit down and hash it out, can we expect to build a meaningful and lasting partnership.
