What Online Gambling Rules Can we Expect From the Government’s New White Paper?

Online Gambling

The UK gambling review was initially set in progress in 2019, with the white paper promised in December 2020. Three years on, the industry and players are still awaiting its publication. 

The severely delayed white paper has seen consecutive government upheavals, with gambling ministers toppling in and out of office faster than a line of falling dominos. It’s now under the remit of MP Lucy Frazer, the UK’s new culture secretary, who has publicly promised that the new rules for online slot sites and other gambling platforms will be published “soon,” with many hoping for an Easter release date.

It can’t come soon enough for those campaigning for stricter protection measures for players and the gambling operators affected by the months of drawn-out delays and stalls.

Why does the UK need gambling reform?

Initiated by the labour government, the gambling review recognises that the 2005 Gambling Act is outdated and not fit for practice. The pace of technological innovation and growth of the internet and mobile gambling has outpaced reform, with the digital landscape changing vastly. It’s also been argued by some that the 2005 Gambling Act liberalised the UK market too far, and now it’s time to fix this, addressing the issue of problem gambling, which comes at a substantial personal and public health cost.

What are the expected changes?

While there have been continual updates to regulations and operator guidelines from the UKGC (prohibition of credit cards in gambling, regulation of slot spin speeds, banning of reverse withdrawals, updates to bonus regulations along with others) and some guidance from the government (the Gambling (licensing and advertising) Act in 2014) since 2005, the Gambling Act Review is expected to tighten reforms further, aiming to protect players who now have access to gambling products from handheld devices 24/7.

Affordability checks

Despite player perceptions, affordability checks are nothing new, and between October 2019 and September 2022 (when the guidance ended), the UKGC had rules in place regarding how operators should assess player affordability (Social Responsibility Code Provision 3.4.3). The white paper is expected to permanently implement affordability checks for UK gamblers with talk of a “single customer view”, allowing the same affordability information across platforms.

Affordability checks are controversial, and although the need for casinos to risk assess players and ensure they can afford to gamble (especially when large sums of money are involved), consumers are concerned over their autonomy and privacy.

The Betting and Gaming Council (BGC) has conducted several YouGov polls, showing that the consumer view of affordability checks is largely negative. However, as there have been no specifics regarding what form of affordability checks will be used or how invasive they will be, the questions put to bettors in the polls haven’t been contextualised.

In the lapse, while operators await the white paper, some platforms, like Entain and Flutter Entertainment, have already brought in policies that limit the amount certain players can spend. The results have been positive (Flutter Entertainment has introduced a mandatory spending limit for 18-25s of £500 per month, with over 78% of affected players approving). Hence it is unclear whether the consumer concern is born from fears over limits on spending or the level of data and loss of privacy inherent to affordability checks and data sharing across platforms.

Stake limits of slots

Online slots are the most revenue-generating online casino game in the UK, and the game where players have the largest average losses, making them a higher-risk option in the eyes of regulators. There have been several measures levied at slots already aimed at decreasing the risk associated with playing these games, including the banning of feature buy and autoplay, the limitation of spin speeds to 2.5 seconds and above, and new rules regarding how wins are displayed (win animations and sounds are only permitted if the win amount if higher than the stake). 

The white paper is expected to introduce a maximum stake per round of £2-5. Currently, there is no upper cap on slot spins, but most games offer a range from £0.01-400. While the majority of players don’t stake this high, many cross the £2 mark: hence the impact on industry revenue is likely to be extensive (a previous government assessment showed stake limits and affordability checks could see “online gambling revenues could fall by as much as £700m.”). There is also concern that stake limits and affordability checks will drive players offshore for fewer restrictions on gaming.

Statutory Levy on Operators

The white paper is set to introduce a statutory levy on operators to fund addiction research, treatment and education. The so-far discussed amount would be 1% of revenue and applied to all UK operators. Contributions are currently voluntary, with the UK’s five biggest operators already giving between 0.75-1% of revenue. However, a mandatory rate across all operators would increase the funds available for research and treatment, significantly reducing the costs to the state. 

According to the UKGC, “Any arrangement based on voluntary contributions is not a viable long-term model for funding research, prevention and treatment of gambling harms.” They argue that two-thirds of all gambling jurisdictions globally now have a mandatory system in place, and the UK must follow suit to address issues in transparency, equity, and the availability of services and research.

Changes to promotions

Many of the original proposed changes to bonuses and promotions, such as the potential banning of free bets and VIP packages, are now said to have been dropped, as the industry has implemented mandatory checks and cleaned up its language surrounding bonuses and promotions. The UKGC has also issued new bonus terms and interaction guidelines. One area of particular concern was the use of rewards and VIP deals to encourage players who had stopped gambling to spend more.

One element that might still be on the white paper is curbing high wagering requirements. Wagering requirements are contentious, as there are no upper caps on this bonus term and condition, which sees some gambling sites implement requirements as high as 99x. According to the UKGC, these “encourage excessive play”, which is not in line with player protection, fair terms or responsible gambling.

Changes to sponsorship and advertising

The last significant change expected in the white paper is new advertising rules, especially in sports sponsorship. The current advertising rules for gambling brands have been criticised as being too vague and not covering social media. 

A topic of hot debate has been the potential banning of shirt sponsorship deals with betting firms. Although there is speculation that a voluntary approach has been favoured in the final white paper text. The government would prefer sports clubs to self-regulate in this area, but in practice, gambling brand sponsorship deals are so lucrative that some sports clubs cannot afford to stop the practice.

Since the debate began, highlighting the issue of underage exposure to gambling via sports, the normalisation of the industry, and the damage it’s caused, many football clubs have said that the industry can “thrive” without these sponsorship deals. Additionally, they feel there is a “moral duty” for sports clubs to cut ties with gambling brands, even asking that any new rules be extended past shirt sponsorship and also include stadium and competition sponsorship. 

While football clubs may be well-placed to survive a sponsorship ban, other sports, like horse racing, are worried over viability if this financing stream is removed, leading the government to seek a “balanced approach”.

Final thoughts

Whatever the specifics of the white paper, it is clear it will signal a change of tide in UK gambling. Away from a more liberalised market towards greater regulatory control. It’s inevitable, and it’s time that regulation caught up with the market to provide sufficient protection for players.

In the time that has elapsed since the announcement of the gambling review and during the successive delays, many operators have already implemented costly changes based on little information, meaning these may not even be aligned with the finalised content of the white paper. 

The uncertainty regarding the new rules has also allowed consumers to speculate over the invasiveness of affordability checks, and mass media attention has made them more aware of offshore gambling options. It’s beyond time that the government releases the white paper and provides more clarity for players and operators.

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