On 16 July 2019, the Government published a response to its consultation on whether to increase the amount of money that society lotteries can raise for good causes. This was welcome news to the society lottery sector, as some operators were considering applying for a second operating licence, in accordance with the regulations, to increase a potential fundraising ability by way of a lottery product.
Despite the response to the consultation, there was little action by the Government immediately to allow this to be confirmed in law by way of a Statutory Instrument. This is largely down to Government time being spent mainly on Brexit and then, more recently, the General Election in December 2019.
On 19 December 2019, in anticipation of the changes to the law regarding the financial limits, the Gambling commission opened a consultation into the changes to the financial limits and also social responsibility changes. This consultation was titled ‘society lottery reform’. The consultation closed on 12 March 2020 and the response was published on 30 April 2020.
The response from the consultation confirmed that the Gambling Commission will amend the Licence Conditions and Codes of Practice (LCCP) to come into effect from 29 July 2020.
The amendments to the LCCP include amendments to licence conditions:
- 18.104.22.168; and
- Addition of social responsibility code 4.3.3.
These changes stipulate that a lottery promoted in reliance on the licence may not exceed £5 million and the aggregate of the proceeds of lotteries promoted wholly or partly in a calendar year may not exceed £50 million. These changes will come into effect immediately from 29 July 2020, therefore there is a further licence condition setting out the financial limits applicable for 2020 only. This licence condition reads:
“2b – In 2020, the aggregate of the proceeds of lotteries promoted wholly or partly in a calendar year may not exceed £31,311,475”.
This will be welcome news to society lotteries that have been edging closer to the previous limit of £10 million aggregate proceeds in one calendar year and considering its long term lottery strategy. The changes to the financial limits mean an increase of £40 million in a calendar year for aggregate proceeds.
In addition to the “main news” relating to the financial limit increase, the consultation resulted in an addition to social responsibility code 4.3.3. This social responsibility code states:
“1. Licensees must ensure that clear, transparent and easily accessible information is made available to consumers to enable them to make an informed choice prior to participating in a lottery. This must include, but is not restricted to details of how proceeds are used and the likelihood of winning a prize and how prizes are allocated.
2. Licensees must take into account the Commission’s guidance on information to lottery players”.
The Gambling Commission have published a guidance note dated April 2020 that goes into a little more detail regarding how to be transparent and easily accessible for the purposes of meeting this social responsibility code. It is likely that this guidance will raise further questions to ensure compliance, but it appears to promote transparency, similar to what the Charity Commission requires for registered charities.
Both of the changes mentioned above to the LCCP will be in effect from 29 July 2020 which alongside the ban on credit cards that came into effect from 14 April 2020, shows that the Gambling Commission are making big changes this year. This is somewhat overshadowed by covid-19 and what operators have had to deal with as a result of this disruption. However, it carries on the line of stricter regulation by the Gambling Commission and an increased focus on protection against gambling harms.
If you would like to discuss the change to the LCCP and how this may affect your operations, then please do not hesitate to contact Sarah Frow (firstname.lastname@example.org) or Andy Woods (email@example.com), in the lottery and gaming team.