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UK Considers Increasing Online Gambling Licence Fees in 2021
By Shane Addinall Feb 03, 2021 IndustryDCMS proposes high costing changes for Gambling Commission and license fee hikes to assist with cost and regulation. Price hikes and new rules proposed are all an attempt to better regulate a rapidly growing industry.For British online casino players and online casino operators, dark days are ahead.
The Department of Culture, Media and Sport (DCMS) proposed a hike in fees to assist with the regulation of the gambling market.
If approved there could be a 55% increase to British annual remote licenses and a 60% increase of new license fees.
The Fight Against Modern Challenges
The DCMS proposed the fee changes in a consultation that opened late January and is open until the 25th of March 2021.
This consultation will be entirely separate from the Gambling Act review consultation which is also currently being undertaken by the DCMS and meant to look into the Gambling Commission.
The Gambling Act Review will be completely dedicated to current gambling regulations and whether changes are necessary. Especially since there have been major advancements on a digital scale since the 2005 Act was put in place.
The main objective is to create a safe gambling environment dedicated to protecting customers and preventing gambling addiction. As such there will also be a thorough examination of The Gambling Commission who is happily working with the Government throughout the review procedures.
As for the latest fee change proposals, the consultation document listed three major challenges currently faced by the Commission. These being the rapid increase in technological developments, Commission regulated large global businesses and thirdly, the looming threat of unlicensed/black market operators.
Proposed Changes to Fight the Challenges
The DCMS has suggested that the Commission should hire more specialist technical staff which should include a chief product officer and staff with proven technical expertise.
Additionally, the Commission should invest more in tools for improving compliance and improve the way it works, ensuring better use of the wealth of data it collects. If these changes are to be fully implemented by 2023/24 it will cost about £1.2m.
As for the second challenge, the DCMS states that the Commission should have more staff working on driving the international regulatory agenda and working alongside other regulators. On top of that, there should be staff that can interrogate and understand companies with complex corporate structures. An increase of legal capital in favour of the Commission was proposed to assist in this matter. If implemented, it would require an additional £1.0m.
Lastly, more staff should be hired to identify and tackle the issue of black-market operators. This would cost less than other measures with implementation standing at £300,000.
Funding Gap leads to higher fees
According to the DCMS, the Commission would face a £4.7m funding gap by 2023-24 if they implemented all of the proposed changes.
And while it is noticeable that effort has been put in to cut cost in all areas possible, it would be necessary to increase fees of both new and existing operators in the future.
The proposed increases are focused on the remote sector and its suppliers with an increase of 55% proposed on annual license renewal fees for remote and software licensees. This would then be implemented in October. However, casinos offering Random Number Generator (RNG) games could see this fee doubled.
For the non-remote side of the industry, there is a proposed renewal fee increase of 15% which should come into effect by April 2022. The delay is purely to offer relief to all businesses most affected by the COVID-19 pandemic.
All new licensing applications will have a 60% increase in fees if the proposal is accepted, regardless of the license.
Currently, stakeholders are being asked a handful of questions regarding these proposed changes and are encouraged to engage and even provide alternative solutions.
The Gambling Commission has already spoken in support of the changes, stating the extra funds could help it regulate the rapidly-changing industry.
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