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Advice and guidance updates

Premises annual fee refunds and partial payments

Following a number of queries in relation to refunds of premises licence annual fees, we have signposted LAs to the information provided in last summer’s bulletin (opens in new tab).

The Commission’s view is that no regulations providing for refunds have been made under section 184(4) of the Gambling Act (opens in new tab), and so LAs do not have the discretion to refund annual fees for premises licences where the operator ceases to trade during the year.

Our view is that the power to authorise refunds is specifically reserved for the Secretary of State by virtue of section 184(4). Similarly, there is no scope within The Gambling (Premises Licence Fees) (England and Wales) Regulations 2007 (opens in new tab) and or The Gambling (Premises Licence Fees) (Scotland) Regulations 2007 (opens in new tab) for pro-rata payment of annual fees where the premises intends to close within a few months of the fee being paid.

The Commission’s view is that a local authority doing either of these would be acting ultra vires; however, this is not legal advice and only the courts can make a final decision.

Licensing authority annual review of premises fees

At this time of year we always remind LAs in England and Wales about the annual review of their gambling fees. Fees in Scotland are centrally set by the Scottish Government.

Whilst LAs may have had to delay their review process due to Covid-19, please ensure that relevant colleagues are aware of the maximum fee levels, which are set by the Department for Digital Culture Media and Sport (opens in new tab) (DCMS). We have recently found examples of gambling fees which exceed the maximum.

In terms of fee levels in England and Wales, the Gambling Act (opens in new tab) states that LAs shall “...aim to ensure that the income from fees as nearly as possible equates to the costs of providing the service to which the fees relates” (Gambling Act 2005 (opens in new tab) Section 212(2) (d))”

The DCMS (opens in new tab) guidance to LAs on setting premises licence fees therefore states that: “Licensing authorities should therefore review and publish their fees annually to ensure that the income from the premises licence fees in any one accounting period (that is, in any full financial year) does not exceed the full costs incurred by the authority in carrying out the relevant functions”.

The DCMS (opens in new tab) fee guidance, which is available on the LGA’s knowledge hub, also states the annual fee will cover the reasonable costs of compliance and enforcement work, including the cost of dealing with illegal gambling in a licensing authority’s area.

Fee setting must be transparent, and an LA should closely track its costs and be able to evidence how it arrived at the fee levels to demonstrate that they have been calculated on a cost recovery basis only.

Although ultimately it is a matter for the courts, we understand that the Supreme Court ruling in Hemming v Westminster does not impact on licensing authorities setting premises fees under the Act, as the Act does not fall within the scope of the EU Services Directive.

A range of guidance and information is available for licensing authorities:

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Last updated: 7 December 2023

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