UK annual remote licensing fees could rise by 55% to give the Gambling Commission the resources to regulate the fast-growing industry and tackle the growing unlicensed market.
Commission would need £2.5m to meet all challenges by 2023/2024
The Department for Digital, Culture, Media and Sport ( DCMS ) has launched an open consultation proposing to increase Gambling Commission fees to help the Commission continue to recover costs and respond to new challenges.
The aim is to implement the proposed annual fee increases for remote licences and all application fee increases by 1 October 2021 . However, for existing operators who are not remote operators, the annual licence fees would rather be increased from April 2022, Given the situation of the land-based sector due to the Covid-19 pandemic.
The consultation paper highlights three main regulatory challenges that will gain momentum in the near future and need to be addressed. The challenges include increased technological developments (such as product and payment innovations), the emergence of more global operators and the growing black market.
On the first point, DCMS proposes to increase the number of dedicated technical staff at the Commission, as well as investing in tools to improve compliance and better manage available data. The improvements will cost £1.2 million when fully implemented in 2023/24 .
Measures to address the second challenge would cost £1 million and include a focus on an international regulatory agenda, interrogating and understanding complex corporate structures, and increasing legal capacity.
Finally, in response to the growing number of unlicensed operators, DCMS has proposed to recruit more staff to determine the scale of the black market and to recruit more resources to tackle the problem, such as increasing the capacity to prosecute illegal operators. The investment needed to meet this challenge is estimated at £300,000.
A recent report by consultancy PWC found that around 200,000 players spent £1.4 billion on the black market in the 12 months between 2018 and 2019. However, the Commission responded to the report's findings by claiming that it exaggerated the true scale of the illegal market.
Delayed increase in charges for the onshore sector
Under the proposal, annual renewal fees for remote licensees and software licensees, excluding lottery, from October 2021. They would increase by 55% in each fee band. Operators offering random number generator (RNG) games, such as online casinos and slot machines, would pay £2,500 or £5,000 more. The sector, which is not far off, would face a 15% increase in the renewal fee , which would come into effect in April 2022, And the delay was to help companies affected by the pandemic.