The UK government has announced that licence fee costs across all the UK’s gambling business verticals will increase, with the new fees being enforced from October 1.
The measure was announced by the Department for Digital, Culture, Media & Sport (DCMS) when it published its response to a consultation launched on January 29 reviewing the UK Gambling Commission’s (UKGC) funding structures.
Central to its assessment, the consultation had proposed that the DCMS should increase licensing fees across the board, for the UKGC ‘to cover its costs and address its regulatory challenges’.
In its response, the DCMS outlined that it would proceed with the following measures:
- Increase annual fees for remote operating licences by 55% on October 1
- Increase all UKGC licence application fees by 60% from October 1
- Increase annual fees for non-remote operating licences by 15%, with the implementation of these increases delayed until April 2022
- Make changes to simplify the fees system, including removing annual fee discounts for combined and multiple licences, on October 1
The DCMS stated that the licence fee increases were needed to help the UKGC govern the industry as it faces a new decade of challenges concerning new technologies, changing consumer habits and governing a sector that is being radically reshaped by M&A consolidation and globalisation factors.
Furthermore, a well-resourced UKGC is needed to protect consumers and the sector’s licensed businesses from a ‘black market encroachment’.
Analysing the UKGC, the DCMS pinpointed an increased investment is required to improve the Commission’s staff training and overall expertise as a regulatory agency governing a high-risk sector.
“The Commission’s investment strategy will enable it to proceed with the highest priority investments. For example, in meeting the challenges posed by technological innovation, the Commission needs to invest in expertise to obtain, store and analyse data, including improving its collection of participation and prevalence data” – DCMS’ response read.
The DCMS disclosed that it had received objections to licensing fees being raised, before the government finalised its review of the 2005 Gambling Act, reconfiguring the UK gambling’s laws, standards and business conditions.
Responding to objections, the DCMS asserted that UK gambling’s flat-fee licensing structures had not changed since 2009, whilst the UKGC had incurred a higher operating cost governing the sector.
Though the COVID-19 pandemic has caused UK gambling land-based GGY to decrease, the DCMS declared that a reduction in the total sizes of the industry did not imply ‘that the governing complexities of the sector had been lowered’.