Obtaining a Gambling License in UK

Gambling Licensing in the United Kingdom

The 2014 changes covered both traditional forms of gambling and expanded to include online gambling. The changes also included offshore firms that provided gambling services to British subjects.

The Basics of Gambling Licenses in the UK

In almost every case, you must complete a gambling license application and submit it to the Gambling Commission before providing gambling services. There are strict licensing standards enforced by the commission. The set of guidelines is called the License Conditions and Codes of Practice, or LCCP. Under the LCCP’s guidelines, an applicant for a license must meet the following criteria:

  • The person must offer fair and open gambling.
  • The person must never exploit, harm, or otherwise use children in any way, and children are not allowed to partake in the gambling activities.
  • The person must offer assistance programs, 12-step or otherwise, to help gamblers who develop an addiction or other gambling problem.

These criteria apply to all gambling operations, whether they are owned by individuals or businesses. In addition to fulfilling these three criteria, gambling operators have an obligation to help stop criminal activity that is connected to gambling, including money laundering and the funding of terrorism.

That means that whoever owns or administers a gambling operation must keep accurate and detailed records of all transactions. Operators must also make a good-faith effort to spot any trends that would indicate criminal activity. It must be stressed that there is no minimum financial threshold for such activity. Were an operator to discover such activity, he or she should immediately report it to the appropriate authorities.

The Different Licensing Categories

Because of the idiosyncrasies of the various forms of gambling, it was necessary to enact slightly different guidelines for each. The LCCP recognizes the following eight categories:

Prospective gambling operation owners should familiarize themselves with the applicable documents so that he or she has no problems.

Gambling License Costs

The amount of fees you must pay to operate a gambling establishment of any kind are governed different factors, including your annual gross receipts, type of establishment, or even number of establishments, among others. For example, if you run a remote gambling website that allows patrons to bet on horse races, earn more than 500,000 pounds but fewer than 5 million pounds, your fee for the year would be 7,169 pounds. If, instead, you operate a string of betting parlors that allow patrons to bet on horse races, it’s the number of parlors that you own that controls your fee. If, for example, you were to own nine betting parlors, your fee would only be 977 pounds. To find out the specifics regarding your particular gambling operation, start here and then click the applicable link for your specific establishment category. The Gambling Commission has proposed a new set of fee guidelines for 2017 but has not yet voted on or enacted the legislation. Prospective owners of gambling operations should peruse the proposition so that they can plan effectively for 2017 and beyond.

Offshore Requirements

There are two categories of offshore gambling operations that provide gambling services to British subjects:

  • Those whose equipment resides within the United Kingdom
  • Those whose equipment does not

To quote the LCCP:

“You do not need a license from us to run a remote gambling service if all of your remote gambling equipment is located outside Great Britain and you do not provide facilities for remote gambling to consumers in Great Britain.”

In other words, if all of your servers are offshore and you have no brick-and-mortar locations in the United Kingdom, such as betting parlors for horse races that contain online terminals, then you do not need to obtain an online gambling license from the Gambling Commission.

However, if you offer remote, offshore gambling services to British subjects, then you must use software produced by companies that do have licenses with the Gambling Commission. For complete rules and regulations regarding remote gambling equipment, check the following table.

Doing Your Due Diligence

In February 2015, the Gambling Commission published its “Strengthening Social Responsibility” updates, which further required gambling operators to look out for their customers’ best interests. Some of the precepts of the updates included:

  • Making it even more difficult than before for children to gamble
  • Improving software that tracks each person’s gambling to spot possible harm or addiction
  • Closing marketing and advertising loopholes that promoted possible overindulgence and harm
  • Working with licensing authorities to assess risks and improve customers’ gambling experiences
  • Providing “self-exclusion” options for problem gamblers, which will delete a customer’s account and block his or her IP address in the future

As a gambling operator, you must also provide your customers with detailed information on how to gamble responsibly. In all cases, you should stress gambling as a form of entertainment rather than a true source of income. Here is a useful publication that you can provide your customers.

Conclusion

In all, the United Kingdom has striven to provide a fair and open environment for people to gamble responsibly, which helps gambling operators as well. After all, if customers know you’re on-the-level, they’ll return for their entertainment instead of going elsewhere. The Gambling Commission is there to help both gamblers and operators equally.