GB regulator in unlicensed advertising U-turn

Great Britain’s Gambling Commission has conceded that operators may be able to legally advertise unlicensed products in Britain provided they cannot be accessed by British consumers, although doubts still remain over the ability of operators to sponsor UK teams and events.

In a letter sent to sports governing bodies last week, the regulator explained that, as well having to ensure British consumers were blocked from accessing unlicensed sites, from 1 November operators would also be required to make clear its products were not available to British consumers.

It had been feared that unlicensed operators, particularly Asia-facing brands with little or no British business, would have to stop using globally televised British sporting events as a vehicle to advertise their brands to international markets.

The regulator previously insisted that only licence holders would be able advertise within British shores, even in cases where operators were not targeting the market after questioning their ability to successfully block British customers.

However, this stance was called into question by lawyers who argued the Commission had no legal justification to implement such a policy with the scope of the regulator’s remit limited to companies offering products to the British market.

Legal view

Alice Himsworth, gaming lawyer at law firm Olswang, said she was “surprised” by the contents of the recent letter but welcomed the fact the Commission had fallen into line with the legal consensus on the subject.

“We were surprised to see the Gambling Commission’s letter to the sports governing bodies as it appears to mark a significant departure from the message it had been promoting over the course of the summer and even that in its recently published gambling advertising quick guide and ‘Guide to gambling advertising codes’ – both of which are still available online,” Himsworth said.

“The letter sets out the position that we have consistently argued to be correct, that a licence is required to transact with British customers, but not necessarily to advertise to them,” she said.

“As we have previously said, provided that an operator puts in place effective means of preventing customers from within Great Britain accessing its remote facilities, the offence of advertising unlawful gambling will not be committed by advertising those facilities in Great Britain,” she added.

Grey area

Speaking to eGaming Review this morning, a spokesperson for the Commission confirmed the contents of the letter but declined to give any detail on how firms would be expected to ensure British consumers were aware of the unavailability of certain products.

“It is not for the Commission to seek to prescribe how unlicensed operators communicate with potential customers via their advertising but we believe that there would be a real risk of an offence being committed if those advertisements did not make clear that the particular product was not available to consumers in Britain,” the spokesperson said.

However, Susan Biddle, gaming lawyer at Pinsent Masons, questioned the Commission’s legal justification for this added stipulation should it be required that the clarification be inserted into the advertisement itself.

“Would players’ shirts, replica shirts and stadium boards which carry a sponsor’s logo each have to include an asterisk to a disclaimer somewhere else on the shirt or board?” Biddle said.

“Such a requirement would seem in practice to mean that sponsorship or other advertising by unlicensed offshore remote gambling operators will not be possible even if as a matter of practice they can achieve 100% successful blocking of British consumers,” she added.

In the letter, the Commission warned sports bodies that should an operator with which it holds a sponsorship agreement fail to fulfil the two stated requirements, it would be committing an offence of unlawful advertising under section 330 of the Gambling Act.

“Our letter to sports governing bodies was aimed at providing guidance to those bodies and their members in the context of the transition to the new licensing regime and alerting them to the risks of inadvertently committing the offence of advertising unlawful gambling,” the spokesperson told eGR.

“Sports clubs would, of course, be expected to take their own legal advice but, as stated before, we would strongly encourage sporting organisations with existing commercial relationships, in their own interests, to take effective steps to ensure that such of their sponsors as do not hold an operating licence issued by the Commission block access to British consumers and have made it clear that their betting product is not available to those in Britain,” the spokerperson added.