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Gambling Advertising: The Gambling Commission’s revised enforcement strategy

The spotlight continues to fall on gambling advertising. All operators must comply with licence conditions and codes of practice which require them to make clear… Read more

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The spotlight continues to fall on gambling advertising. All operators must comply with licence conditions and codes of practice which require them to make clear any conditions which apply to promotions and to comply with the Advertising Standards Authority’s CAP and BCAP codes of practice. Recent rulings by both the Gambling Commission and the Advertising Standards Agency (ASA) have made clear that compliance is an issue for both gambling operators and their affiliates and marketing agencies.

In May, BGO Entertainment was fined £300,000 for adverts which were found to be potentially misleading as they failed to make clear the conditions surrounding promotions. The fine related not only to adverts on BGO’s own website, but also to adverts which had appeared on its affiliates’ websites. BGO’s failure to take effective action to address these breaches of its licence raised doubts about its suitability to carry out its licensed gambling activities.

In February, the ASA upheld a compliant about a Lottoland radio advert which failed to make clear to players that they were betting on the outcome of lotteries, rather than participating in a lottery. In June the Gambling Commission also fined Lottoland £150,000 for failing to make this distinction clear in its third party marketing, website and social media promotions. The distinction is important because part of the proceeds of a lottery must go to good causes.

These advertising rules aren’t new – but the Gambling Commission’s approach to enforcement perhaps is. In its “Raising Standards” conference in November 2016, the Commission stressed that advertising was a focus area, operators are responsible for their affiliates’ actions, and the Commission was ready to take action, and it repeated this message at the ICE gambling expo in February.

On 5 July the Gambling Commission published its revised enforcement strategy which confirms the approach we are already seeing in practice. Three key points are:

The Commission will use all its enforcement powers – there is no longer a bias towards settlement, so licence reviews are more likely.
Consumers must be treated fairly, and advertising is a key part of this.
Penalties are likely to be higher, particularly for repeated failures.

The ASA published a short guide to key CAP Code requirements for gambling adverts on 21 July, and guidance on the Gambling Commission requirements is also available on the Commission’s website. It’s not only the Gambling Commission and the ASA who are interested – the Information Commissioner’s Office is concerned to ensure that marketing by operators and their advertisers complies with privacy rules. A key area for concern is whether recipients of marketing material have given the necessary consent – and requirements for consent are going to get tighter when the EU General Data Protection Regulation comes into effect in May 2018.

It is also critical that advertising meets social responsibility obligations. Gambling adverts must not be sent to under 18s (under 16s for lottery adverts), or to anyone who has self-excluded. Targeting an advert may be critical to its compliance. In May, a Ladbrokes advert using an image of Iron Man and referring to the film Iron Man 3 was found not to be irresponsible because, although the Iron Man character was likely to appeal to under-18s, the offer was sent only to people who had been validated as being over 18.

The recent decisions and enforcement strategy make clear that affiliate breaches of advertising or privacy rules may result in an operator being fined and, potentially, even losing its gambling operating licence. Gambling operators, and their affiliates, are expected to learn from the experiences of others. Operators will want to prevent their affiliates putting them in breach, and a right to compensation for loss incurred if they do. Affiliates will similarly want to know that the operator’s marketing material will not cause the affiliate a problem. Both parties will need a mechanism for ensuring that marketing lists are checked against self-exclusion lists and other targeting criteria.