Industry Forum minutes for 27 January 2025

Minutes of the meeting of the Industry Forum, 27 January 2025.

Remote via Microsoft Teams.

Members:

• Nick Rust (Chair)
• Tony Boulton
• Charles Cohen
• Ashley Padgett
• Mark Pearson
• Nigel Roddis
• Leo Walker
• Helen Walton
• David Williams.

In attendance:

• Helen Child (Head of Governance)
• REDACTED.

Apologies: Kirsty Caldwell.

1. Welcome, apologies and declarations of interest

The Chair welcomed attendees to the meeting and noted apologies.

There were no new declarations of interest.

2. Minutes of last meeting for approval

Both sets of meeting minutes were approved (amendments to the 25 July 2024 minutes and the minutes for the 25 October 2024 meeting).

Note: After the meeting the IF Chair noted an amendment that needed to be made to the 25 October 2024 meeting notes to incorporate a quote and comments from a Forum Member about the Gambling Survey for Great Britain (GSGB) item. This addition will be circulated to IF members for final approval.

IF were provided with an update on the progress of IF minutes redaction and publishing on the website. It was confirmed that the redaction work had been completed on the first batch (covering meetings held March to June) and are in the final stage before going to the Digital Team for uploading to the website.

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3. Assurance statements

IF members were provided with an overview of the current compliance assessment process, the assurance changes that are being considered by the Gambling Commission, the plans for engaging with industry and an introduction to the Commission’s new compliance team approach and structure.

Purpose of assurance statements

Assurance statements are intended to help improve the focus and accountability of large gambling businesses on the delivery of licensing objectives by their boards (or equivalent senior leadership structures).

Assurance statements are intended to provide a self-assessment of the risks to the licensing objectives posed by the business; how well the business is managing those risks; details on where improvements are needed and how those improvements will be implemented.

The statements provide a means for boards to provide constructive challenge to the business on the effectiveness of governance and risk management arrangements in facilitating positive consumer protection, addressing gambling-related harm and crime prevention measures.

Assurance statement process

Has been in place for 5 years – originally in long form with over 30 open ended questions, which could end up being as long as 80 pages. This was both a lengthy process for operator to complete and Commission officials to review.

A short form version was introduced in 2023 that had 8 yes or no statements, with space for detail for any ‘no’s’. The statement requires whole board sign off (the original long-form required CEO sign-off). Around half the statements target common failings from assessments and the others are in the form of board statements. There are now separate assessments for B2C and B2B businesses.

Are required to be completed by businesses with greater than £50 million Gross Gambling Yield (GGY) (around 30 operators).

Assurance statements 2024 to 2025

Will continue with the same format as 2023 (short from version with yes or no statements).

Almost entirely targeted, around themes of failings and areas of focus.

There will be increased coverage – all operators with greater than £25 million GGY. Expect around 50 operators to be covered.

There will be 3 different statements:

• B2C remote and/or online
• B2C non-remote and/or land-based
• B2B.

Industry Forum members were shown examples of the proposed 2024 to 2025 questions.

Assurance statement timeline

A timeline of industry engagement around the scope of the assurance statement changes was provided to Industry Forum members:

• communications have already taken place with operators who were previously in scope (October 2024)
• the draft template will be shared with trade bodies early to mid-February with the end of February being the deadline for feedback
• feedback will be reviewed, and the template finalised early in March
• the final version of the template will be shared with operators for completion in mid-March
• submission deadlines for operators will be staggered. 30 May for those previously in scope and 30 June for those new to assurance statements.

Industry Forum members were asked for their feedback.

Forum members clarified that the text in the original survey format was fully free-form text (not structured). Commission officials informed members that each survey could have 5 to 10 pages of text in response. This was much reduced from the 2023 survey when responses were converted to binary yes or no responses. However, there is still a free-text box to provide more information for ‘no’ responses, where detail on what needs to be done to achieve compliance and when compliance is expected can be added.

Commission officials clarified that the survey goes out annually to organisations that are within scope (this includes licenced games and software providers), they cover the period 1 January to 31 December and are intended to prompt organisations to think about the themes and issues covered in the statements.

Forum members asked what the Commission does when an organisation indicates they have compliance issues. Commission officials noted that the alignment of assurance statements and account management is intended to build trust and openness between the Commission and operators, and to help operators understand that they will not get penalised for sharing this kind of information. Notification of compliance issues would not result in an automatic compliance assessment, but the Commission would want to have a conversation with the organisation, and this would be followed up again in around 6 months’ time to review progress. However, if there is found to be issues that an operator should clearly have been aware of, but has not included, when providing the Commission with assurance, that would be considered as part of any licence review and enforcement action.

Forum members asked how the Commission defined “reasonable assurance”, as this may be interpreted differently between operators. Commission officials commented that this was a good question. The binary nature of the questions makes it difficult to indicate that there is adequate assurance. It was noted by officials that it would be useful to consider how to get better clarity on how operators promote assurance and what plans are in place in relation to the statements provided.

Forum members raised a question regarding the definition of ‘timely’ in assurance statements. Conversations with Commission staff suggested ‘timely’ refers to real-time interaction, but this interpretation has not been consistent among all operators. Commission officials noted that this would be reviewed to see how this could be addressed.

Forum members asked whether questions could be pitched differently. For example, along the lines of ‘do you have internal activities to provide to the executive team or board to assure compliance?’ The Commission should ask questions in a way that prompts operators to articulate the activities that are taking place internally. They suggested that this could be a slightly better way of pitching it and be more effective, making questions a little less subjective. However, members also acknowledged that doing it this way could make it hard to avoid long form answers.

Members noted that prior to the shorter form in 2023, assurance statements were a big piece of work for compliance teams, often going through several board meetings. Although operators generally considered the end product to be useful, they struggled to justify the time and resource needed to complete the work.

REDACTED. Commission officials clarified that statement questionnaires are different each time. Some themes have carried over to subsequent assessments where failings are being seen, but most are different as new areas are identified.

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Commission officials noted that pre-engagement work is fairly new, and they have had positive feedback from operators on this. This includes looking at customers and providing samples earlier in the assessment process. Assessments used to take place over 3 days (usually back-to-back) and were seen as quite an intense process. The team are now trying to spread assessments over 4 days over a two-week period to make the process smoother and easier for both the operator and Commission officials. There is a ‘findings’ meeting following the assessments and the process is completed with a report that is shared with the operator.

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Forum members queried what would constitute a high-risk spike.

This is when Commission officials see a big spike or intelligence on an area of an operators business. This is identified using a range of data. For example:

• customer complaints
• Alternate Dispute Resolution (ADR) data
• contact centre data.

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Forum members were given information on how licensees are selected for assessment:

Based on a multi-layered risk-based approach that considers quarterly regulatory returns and factors such as:

• size and impact
• unusual changes in regulatory return data
• key event follow-up
• identification of novel products or practices
• significant or unusual corporate control changes
• consumer complaint data
• intelligence
• adverse media coverage
• recent enforcement cases.

Forum members were provided with an overview of assessment changes:

• engagement takes place earlier and explains the process to operators
• shorter days of engagement that are split across a wider time period
• there is a specific session to run through customer journeys (front and back end) including risk scoring through algorithms
• clearer scheduling for Personal Management Licence (PML) interviews
• more information (data) requested up front, including customer data
• wider customer data requests covering 14 areas including: deposits, losses, time on site, withheld withdrawals, time outs, deposit limits, returning from self-exclusion.

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Commission officials noted that change will not be implemented overnight. There will be further consultation with trade bodies and other stakeholders. The goal is to help collate more assurance with the Commission’s limited resources.

Forum members were provided with an overview of industry engagement across the Commission. This was broken down into 4 key areas:

1. Strategic (Stakeholder and Governance teams): includes Commission executive engagements, this forum (Industry Forum), and direct operator meetings.
2. Proactive (Compliance team): includes account management, trade body engagement and thematic workshops. This has been introduced over the last 12 months and has had positive feedback.
3. Reactive (Licensing team): includes Licensee services – staffed inbox, phoneline, new applicant and/or licensee support.
4. Events (Communications team): includes CEO Briefing, Spring Conference, Operator Engagement Forum.

4. GamProtect

The forum was provided with an update on the current priorities and challenges for the GamProtect project. Commission officials are looking for opinions around onboarding and how the pace of this could be accelerated.

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Commission officials noted that the development of the platform and the collaborative nature of the project has gone well so far. It has been a challenging path but has had a huge amount of support from the founding operators. However, there is a need to pick up the pace of wider onboarding. Currently there is a two-tier market: those operators that are a part of GamProtect and those that are not. There is a danger that the 6000 or more consumers that have been excluded so far could go to non-GamProtect operators.

Both GamProtect (made up entirely of people from industry) and the Commission are keen to increase the level of onboarding. Currently GamProtect has been adopted by 42 brands across 7 operators and a further 6 operators are expected to join in the next 7 to 8 weeks.

Activities to support this so far have included sending messages out from the Commission’s senior leadership team (including the Chair and CEO) and direct engagement with the industry with engagement days being held in September 2023 and September 2024.

Commission officials asked Forum members how take up could be encouraged, especially amongst non-BGC members. Officials were also keen to understand what the barriers could be and what could be done to support those not currently signed up. Officials also asked what forums could be useful to engage with.

Forum members shared their thoughts:

1. Smaller operators who do not have the resources are likely to find it easier to access GamProtect through another provider, therefore reducing the complexity for them to implement it directly. REDACTED.
2. Forum members would like to be able to monitor displacement risks. They were particularly keen to understand that as the project rolls out to more brands, whether customers are getting displaced to the illegal market and/or unlicensed gambling providers. Commission officials reported that they are working with NatCen on evaluation, and this is one of the key points of risk to be measured.
3. Commission officials noted that GamProtect is currently focussed on extreme harm, but that in the longer term it should be informing lower risk. REDACTED.
4. Forum members suggested that better communication, such as blogs, about the product would be useful. Commission officials noted that there have been some blogs about GamProtect on the Commission website, but these had not been heavily pushed. REDACTED.

5. Unlicensed Gambling (Enforcement)

Commission officials highlighted some of the challenges for the Commission around the classification of unlicensed gambling:

1. Confusion on what is classed as licensed and unlicensed gambling. An operator that is licensed in one jurisdiction may not be licensed in another. Some consumers are aware when they are accessing unlicensed gambling operators, but many are not.
2. Appearance of novel ideas or products that do not sit within traditional gambling products (the example of roblox and/or robux was given).
3. Where legal gambling products include illegal gambling products.

Forum members commented that it would be useful know how the Commission defines unlicensed gambling.

A forum member noted that checks on whether a supplier is licensed is challenging without a definition on which to base the answer on. Currently an operator can confirm that they have checked with their suppliers, and they have all said that they are licensed. This can include global suppliers who will say that they are licensed and are an entirely legal supplier. However, it is not uncommon to find that licences held by global suppliers do not cover all jurisdictions, meaning that a UK operator may be inadvertently using a supplier that is not licensed by the UK Commission. Members commented that the more tightly defined this is, the more likely the Commission will succeed in ensuring that operators and gambling related organisations carry out appropriate checks of their suppliers.

Commission officials noted that communicating with the B2B market is a work in process and getting messages out to these suppliers is important to the Commission. For example, the Commission is keen to work with game suppliers to provide them with as much help as possible to reduce the likelihood of them inadvertently supporting unlicensed gambling products or suppliers.

It was noted that a lot of the questions that operators are asking their customers are due to concerns around not meeting compliance assessment and/or regulatory requirements. Operators are keen to not get it wrong, so this can lead to some operators taking an overly cautious position. This is leading to an increasing difference between the experience that customers get from licensed and unlicensed operators. Members reported that customers put off by questions asked by licensed operators are not giving up gambling, they are gambling elsewhere. Forum members would like to see a curb in unlicensed gambling backed up by legislation.

Forum members suggested that it would be beneficial to have a clear explanation of how the Commission distinguishes between unlicensed and illegal gambling. They also emphasised the need for clarity on the Commission’s intent and strategy regarding unlicensed gambling. Members noted that if the strategic position around protecting consumers is just about regulating licensed operators, then this is a problem. Members expressed concerns about whether the Commission can effectively protect vulnerable people from gambling-related harm or exploitation, if consumers increasingly turn to the unlicensed market due to the inability of regulated operators to offer comparable experiences. Forum members noted that this is a complex issue, with operators facing increasing competition from unlicensed and unregulated gambling. They cited the example of cryptocurrency, which now constitutes nearly 10 percent of the industry.

IF members stated that they would be happy to work with the Commission on this issue.

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6. Forum member topics

Forum members discussed potential future topics that could be brought to the group:

Fair and open – the forum is keen to understand the timeline for this and what members could contribute. Commission officials are expecting this to come to the forum for the March meeting, following a Board meeting in February where this is an item for discussion.

GSGB – forum members noted that there had been developments since the group last met. They noted that it is clear that the Commission has taken written action to follow up misuse of GSGB statistics. Members commented that it was good to see that action had been taken. The IF Chair will raise this during a meeting with the Interim Chair of the Commission and ask what the next steps are if cease and desist requests are not acted on. It was noted that it is important that the actions of the Commission and the board continue to be in line with the commitments that they have made around this.

Related to this, forum members asked Commission officials to reflect on whether there are any conflicts of interest relating to the research work REDACTED. Members suggested that Commission review whether there is a conflict of interest and for Commission officials to consider publicly distancing themselves from the comments made in the article.

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Remote Technical Standards – forum members noted it would be good to see.

The changes to the metrics to understand better the ability of operators to report on those.

Senior executive visibility – Forum members said it would be good to see senior Commission executives observing more IF meetings.

7. AOB

It was noted that the Commission’s Interim Chair is very interested in the 4 expert groups and the value they can add to the Commission.

Publishing of meeting notes – this is progressing for all 4 expert groups in a way that is acceptable for us to publish on our website and with the necessary redactions applied.

Industry Forum members were asked to let Commission officials know if they, or a colleague, would be willing to participate in a Spring Conference session. The request is to talk for 10 to 15 minutes on premises adaptation and changing customer demands of the land-based gambling sector. Commission officials are particularly interested to hear from potential speakers who have experience across European jurisdictions who can provide an insight into how things differ from country to country in terms of different games and play patterns. Commission officials have gone out to industry but have had very little response so far.

Commission officials alerted Industry Forum members that they would shortly be approached for their feedback on a proposed question to be incorporated into the Gambling Survey of Great Britain relating to unlicensed gambling.

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The Chair thanked everyone for attending and closed the meeting.