The Call for Evidence
When the government published its Call for Evidence in 8 December 2020 in the context of its review of the Gambling Act 2005 (the “Gambling Act Review”), it noted that gambling advertising and marketing had expanded into new channels and had grown significantly since the Gambling Act 2005 (the “2005 Act”) came into force in 2007. Despite voluntary actions that had been taken, such as the 9pm watershed on most television advertising and the ‘Whistle to Whistle’ advertising ban around live sport, those measures had not gone far enough and vulnerable groups, the Government confirmed, were still exposed to gambling advertising. Furthermore, the public was becoming increasingly concerned about the relationship between sport and gambling.
At the time, the Committee of Advertising Practice (“CAP”) was consulting on the gambling content restrictions in the UK advertising codes and it was clear that outside of the Gambling Act Review, measures would be introduced safeguard against harms in relation to gambling advertising and marketing.
Against that backdrop, the Call for Evidence requested evidence in respect of:
The White Paper
Since the publication of the Gambling Act Review White Paper (the “White Paper”) in April 2023, its proposals on marketing and advertising have been criticised by some commentators for being too light touch – and they were relatively light touch. Perhaps that is partly because, as the White Paper confirms, the Call for Evidence submissions showed “a lack of conclusive evidence on the relationship between advertising and harm” and “little evidence of a causal link with gambling harms or the development of gambling disorder”, and partly because the government felt that the protections that had been, or could be, introduced outside of the Gambling Act Review would provide additional protection.
We have discussed each of the proposal in turn below, but we think the key actions for the industry are:
Bonuses and direct marketing
Restrictions on marketing to customers who do not demonstrate strong indicators of harm
| Potential restrictions on direct marketing and offering bonuses to customers who don't demonstrate strong markers of harm.
| Gambling Commission consultation resulting in changes to LCCP
| Consultation expected later in 2023, with changes likely coming into force in 2024.
The White Paper noted that bonuses, promotional offers and direct marketing are the forms of advertising that are most likely to impact gambling behaviour, and that those at the greatest risk of harm have the highest exposure to this form of marketing.
In accordance with Requirement 10 of the Gambling Commission’s customer interaction guidance, operators should already prevent direct and targeted marketing and the take up of new bonuses by customers who show strong indicators of harm. The White Paper suggests that the Government does not think this goes far enough, and that restrictions may be imposed in relation to marketing to customers who don’t show strong indicators of harm. Whilst those restrictions will be subject to consultation before they are implemented, operators may wish to consider how they would be able to justify that sending direct marketing to any single customer was appropriate and evidence that the customer was not displaying markers of harm.
The Government is clearly concerned about free bets and bonuses and their potential to encourage harmful gambling. Despite the industry going through a full investigation by the Competition and Markets Authority (“CMA”), which brought widespread change to the way promotions could be conducted, the Gambling Commission will revisit this area and will consult later this year on free bets and bonuses and ensuring they are constructed and targeted in a socially responsible manner, as well as a cap on and increased transparency around re-wagering requirements and the use of time limits before bonus offers expire. Similar restrictions have been introduced across Europe and it seems inevitable that some restrictions will be introduced. As such, operators should review their free bet and bonus offers and consider how those could be made more ‘socially responsible’ and whether their terms are clear enough for an ordinary punter to understand.
For now, there will be no further restrictions in relation to online or land-based VIP/high value customers (“HVCs”), as the controls that were introduced by the Commission in 2020 appear to be adequate.
The message from the White Paper is clear; operators must conduct their direct marketing strategies in a socially responsible manner, otherwise policy may be directed towards a tightening of restrictions in the coming years. Whilst this is more applicable to online operators, given the Government’s stance that current controls on land-based operators in this area are adequate, all operators should also take this advice on board.
Direct marketing consent and opting-in to offers
|Gambling Commission consultation resulting in changes to LCCP
|Consultation expected later in 2023, with changes likely coming into force in 2024.
There are already clear requirements in place that operators must seek informed and specific consent to send direct marketing to consumers, as well as that direct marketing must not be sent to those who have self-excluded or are showing strong signs of harm. However, given the Government’s comments on the dangers of ‘cross-selling’ (for example, giving free online slots spins to sports bettors or heavily marketing casino products to bingo players), particularly where a more ‘high risk’ product is offered, it seems likely that the Commission’s recent consultation, which closed [BB1]on 18 October 2023, will result in:
These changes will be brought about by updates to the LCCP in due course, and could have a significant impact on an operator’s customer journey/user experience and ultimately the ability for operators to extract value from their customer database.
Making online advertising smarter and safer
|Operators will potentially be required to ensure that online advertising specifically de-targets children and young persons.
|Most likely through updates to the IGRG Code.
|Uncertain - the IGRG Code was updated in September 2023 but this change was not incorporated.
Online advertising technologies have advanced significantly since the 2005 Act came into force and data-driven advertising techniques are now widely employed by gambling operators. The White Paper clearly evidences the Government’s growing concern that these technologies increase the likelihood of advertisements being targeted at vulnerable customers, who are also more likely to spend money as a result of seeing them.
The White paper proposes two packages of reforms to make online advertising smarter and safer: a stronger and more comprehensive approach to targeting and content standards from operators, and a range of online platform safety measures to make it easier for individuals to reduce exposure to gambling content and access support. Operators are encouraged to make use of available technology to extend commitments to de-targeting children and vulnerable people and age-gating social media, for example by using stricter algorithms in their automated advertising campaigns.
Second, the government proposes safety measures for online platforms to allow individuals to reduce their exposure to gambling content, for example by enabling one-click opt-outs from gambling advertisements and signposting users to support pages where their search history suggests they may be struggling with gambling problems.
Safer gambling messaging
|New robust safer gambling messaging, replacing industry-owned safer gambling messaging.
|Consultation by the DCMS.
|Timeframe has not been announced - unlikely to be in 2023.
‘Safer gambling messaging’ covers three strands:
The Government is taking safer gambling messaging out of the industry’s hands and giving it to statutory bodies. The evidence presented in the White Paper, the Government states, suggests it would be beneficial to develop systematic messaging, independently from the industry, to maximise the information available to consumers and enable them to make informed decisions with a better understanding of its risks.
To achieve this, the Department of Health and Social Care (“DHSC”), DCMS and the Commission will work together, drawing on public health and social marketing expertise, to develop a robust approach to informational messaging throughout the user journey, replacing industry owned safer gambling messaging.
Once the messaging has been framed, a period of consultation will be undertaken with operators on how to apply the new messaging appropriately. Future changes may include:
In the short term, the White Paper confirms that the Gambling Industry Code for Socially Responsible Advertising (“IGRG Code”) will be updated to extend the British Gaming Council’s (“BCG”) commitment that at least 20% of all TV and radio advertising space is dedicated to safer gambling messaging to include online advertising space. Although commitment to the IGRG Code only has ordinary code status (and a lack of commitment can therefore only be taken into account in the context of wider regulatory action by the Commission), we would encourage licensees to demonstrate good practice and to implement it.
Socially responsible sport sponsorship
|New cross-sport Code of Conduct for gambling sponsorships which may affect the value and structure of deals.
|The Code of Conduct will be developed by sports governing bodies.
|Timeframe has not been announced - unlikely to be in 2023.
Several measures have already been taken on a voluntary basis by the sports industry to avoid legislative restrictions on gambling sponsorship in sport, including the Premier League’s removal of gambling logos from the front of shirts from the end of the 2025/26 season. The Government is clear that gambling sponsorship deals provide the sports industry, particularly at grassroots level, with a critical source of funding (gambling sponsors contribute around £45 million each year across the English Football League’s three leagues, and also account for a significantly higher proportion of overall revenues in the Scottish football leagues). As such, the White Paper does not propose any legislative amendments to restrict gambling sponsorship in sport.
All sports are, however, expected to take a responsible approach to gambling sponsorship and support the sector’s efforts to implement minimum standards for social responsibility through a cross-sport Code of Conduct, which will be developed by the sports bodies. The key principles for that code will be:
Operators should look out for developments in relation to the Code of Conduct and bear those changes in mind when considering their sponsorship agreements to understand how those might be affected. We would also encourage operators to take up any available opportunities to feed the operator perspective in to those preparing the code, either directly or through existing relationships with governing bodies and other stakeholders.
If you’re interested in discussing how these proposals might affect you, please do get in touch. You can also read our general summary of the gambling White Paper here.