The UK Gambling Commission was created and empowered under the Gambling Act of 2005 to regulate the UK gambling industry, with a particular focus on online gaming. It is often held up as a prime example of gambling regulator best practice, and used as a benchmark for comparing regulatory bodies in other countries and states.
Rather than offering a single licence to operators covering all online gaming activities, the UK Gambling Commission offers remote operating licences for each type of activity that an online operator may want to run, including:
In addition to the above activity-specific licences, most significant online gaming operators will also require remote Personal Management Licences (PML) for their senior staff members. This means that anyone who is in charge of important business areas such as financial budgeting, overall strategy, regulatory compliance and IT provision and security must come under scrutiny and gain approval for a PML before being allowed to legally make any operational decisions.
The UK Gambling Commission was set up to regulate the growing online gambling industry, replacing the previous Gaming Board for Great Britain. In 2013, the National Lottery Commission was also merged with the UK Gambling Commission. The following year, it continued to act in the British consumer’s best interests under the 2014 Gambling (Licensing and Advertising) Act.
As the name of this act suggests, it was designed to tighten up practices around gambling advertising targeted at UK citizens. The law now ensures that all gambling operators that provide facilities for remote gambling (or advertise to consumers in Britain) must obtain a remote operating licence from the UK Gambling Commission. This means that even operators which are based abroad must still obtain the proper licence if they wish to serve (or advertise to) customers in the UK. This covers all forms of advertising, including on television, via sponsorship or through physical installations.
Another significant change was brought about by the Point of Consumption Tax, which entered into UK legislation in December 2014. Whereas previously off-shore operators were charged tax at the 'point of supply' (i.e. based on the territory where their operations were located), they are now taxed at the 'point of consumption' (i.e. in the UK) at a flat rate of 15% on gross profits.
Yes, the UK Gambling Commission is considered one of the most diligent gaming authorities in the world, and has several key areas of focus, including:
Online gambling operators must comply with the rules set down by the Gambling Commission (and maintain honest and transparent communications), or else risk having their licence revoked and potentially facing investigation or prosecution.
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The UK Gambling Commission currently licenses over 1000 companies for remote gaming, including operators such as 888, Betfair, William Hill and Ladbrokes. It also lists over 200 gaming development firms as having an active gambling software licence, including industry experts such as NextGen and OpenBet. Although it is broadly well-regarded as an institution, the UK Gambling Commission was chastised in 2014 for its alleged lack of action and advice it provided to the government in relation to Fixed Odd Betting Terminals (FOBT).
Some commentators had recommended stricter controls on the terminals, specifically either removing them from the high street or drastically reducing maximum stakes to bring them in line with other types of gambling machine. However, the Commission was criticised for recommending no immediate action, despite its vocal advocacy of taking "the precautionary approach" when it comes to risk.
Despite this incident, the Gambling Commission clearly prioritises player safety above all, and is currently reviewing a process whereby vulnerable players could exclude themselves from all casinos based in the UK (or holding a UK licence) at once, rather than having to self-exclude with each individual operator – this looks to be the next big legislative change on the horizon for the regulatory body.