Consultation response
2023 Consultation on proposed changes related to financial penalties: Consultation Response
This response sets out our position in relation to the consultation on the proposed changes to the Statement of Principles for Determining Financial Penalties.
Contents
- Executive summary
- Introduction
- Summary of responses and our position
-
- Proposal 1: Principles for determining financial penalties
- Proposal 2: The framework of policies and procedures
- Proposal 3: The legal framework
- Proposal 4: The scope of this document
- Proposal 5: Key considerations
- Proposal 6: The purpose of imposing a financial penalty
- Proposal 7: Criteria for the imposition of a financial penalty
- Proposal 8: Criteria for determining the quantum of a financial penalty
- Proposal 9: Step 1 - Detriment to consumers and/or financial gain to the licensee
- Proposal 10: Step 2 (a) - The seriousness of the breach to determine the starting point of the penal element
- Proposal 11: Step 2 (b) - Determining the starting point of the penal element of the fine
- Proposal 12: Step 3 - Mitigating and aggravating factors
- Proposal 13: Step 4 - Adjustment for deterrence
- Proposal 14: Step 5 - Discount for early resolution
- Proposal 15: Step 6 - Affordability
- Proposal 16: Step 7 - Proportionality
- Proposal 17: Procedural matters, payment plans, time limits and payments in lieu of financial penalties
- Proposal 18: Indicative sanctions guidance
- Proposal 19: Impact of the proposals on protected characteristics stated in the Equality Act 2010
- Annex
Executive summary
We asked
In December 2023, the Gambling Commission consulted on proposed changes to its Statement of Principles for Determining Financial Penalties (SoPfDFP) (the consultation). The consultation (opens in new tab) ran from 15 December 2023 until 15 March 2024.
The SoPfDFP details the Commission’s approach to determining financial penalties imposed on license holders.
In the consultation we proposed to make changes to the criteria for imposing a financial penalty and the methodology for determining the amount of a penalty. The proposed changes aimed to enable the Commission to better achieve the objectives and duties imposed under the Gambling Act 2005 (the Act) by making the Commission’s approach to financial penalties more transparent and addressing stakeholder concerns about the lack of transparency and consistency with regards to the existing approach. Further, the proposed changes were intended to make the decision-making processes clearer therefore reducing the time and resources involved in determining financial penalties. Respondents were invited to share their views and comments on the proposals.
You said
There were 29 respondents in total, and the number of responses submitted by the pool of respondents to each of the 61 questions asked in the consultation document varied slightly between the questions.
Those respondents who consented to the publication of their name are listed at Annex 1.
We have reviewed and carefully considered the responses to the questions for each of the proposed changes as set out in the consultation document before making a decision.
We did
Following consultation, and in response to the feedback received, we have made some significant changes to the existing SoPfDFP. It is not possible to outline all of the changes to the SoPfDFP in detail in this summary, therefore we have outlined them broadly as follows.
Visibility of the process for determining a financial penalty
Provide a clear and distinct 7 step process the Commission will follow when assessing and imposing a financial penalty.
Clarity on the disgorgement element of the penalty
Provided added clarity as to how and when the Commission will calculate the ‘disgorgement’ element of the penalty where clear consumer detriment and/or financial gain by the licensee has resulted directly from the breach.
Assessment factors
Identified which factors would determine the seriousness of the breach and form part of the assessment of the starting point of the penal element, as distinct from constituting aggravating or mitigating factors.
The penal element of the penalty
Included a defined methodology for determining the starting point for the penal element of the penalty by reference to the seriousness of the breach and a percentage of Gross Gambling Yield (GGY) or equivalent income generated during the period of the breach.
Society lotteries and external lottery managers
Detailed the inclusion of society lotteries and external lottery managers in instances where it is not appropriate for the starting point of the financial penalty to be based on a percentage of GGY.
Addressing multiple breaches
Included a defined methodology for addressing situations involving multiple breaches during a period
Adjustments to the penalty for aggravating and mitigating factors
Included a defined methodology for making adjustments to the penalty for aggravating and mitigating factors, deterrence and early resolution, as distinct and separate from the process for determining the seriousness and starting point of the penal element of the penalty.
The revised SoPfDFP will come into effect on 10 October 2025. On or after this date, where the Commission notifies the holder of an operating licence that the Commission proposes to require it to pay a penalty in accordance with s121(2)(a) the revised SoPfDFP will apply.
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Introduction - Changes related to financial penalties consultation response
Last updated: 10 July 2025
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