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  3. 2023 Consultation on proposed changes related to financial penalties: Consultation Response

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.

Published
10 July 2025

Last updated
10 July 2025 - Changes

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Contents

Proposal 15: Step 6 - Affordability

Under Step 6 we proposed to review and, if necessary, make adjustments to the financial penalty to ensure that the total sum is affordable and to safeguard against serious financial hardship on behalf of the licensee.

The proposed approach to considering affordability includes taking into account the financial resources of any parent or group company or ultimate beneficial owner of the licensed entity. In circumstances where the affordability review results in a reduction of the final penalty amount, we propose to publish the original penalty amount as well as the adjusted amount so that there is transparency for stakeholders in terms of the nature and seriousness of the breach, our process in determining the financial penalty, and in order to maintain the deterrence principle.

We sought views on:

  • the proposed calculation method of the total financial penalty being the sum of Step 1 (disgorgement, where it has been possible to identify) and the figure reached at the end of Step 5
  • the proposal to take affordability into account and to mitigate against financial hardship
  • when considering affordability, whether the Gambling Commission should take into account the financial resources of any parent or group or ultimate beneficial owner, in addition to the licensee’s own resources
  • whether the Commission should also publish the level of the financial penalty prior to any reduction applied at Step 6.

We also invited any other comments.

Consultation questions

Questions 52 to 56, as detailed in Annex 2, related to this document.

Respondents' views

Of the respondents who responded to the consultation, the majority of respondents agreed with the proposal that the final penalty amount will be the sum of the amount calculated at Step 1 (where it has been possible to identify) and that at the end of Step 5. Most respondents also agreed with the proposal to take affordability into account, and to mitigate against financial hardship.

Most respondents disagreed with the proposal to take into account the financial resources of any parent or group or ultimate beneficial owner, in addition to the licensee’s own resources, when considering affordability. The feedback received suggested that this may risk penalising entities that are not involved in the gambling industry or who are unaware of their related entities breaches.

There was also some disagreement regarding whether the Commission should publish the level of financial penalty prior to any reduction applied at Step 6 and it was argued that it would not be necessary to do so.

Our position

We have considered the comments raised by stakeholders in the consultation responses and have not made any substantial changes to the wording of paragraphs 2.30, 2.31, 2.32 and 2.33 of the amended Statement of Principles for Determining Financial Penalties (SoPfDFP). As to do so, in relation to paragraph 2.31 would have deviated from the Commission’s existing policy as detailed at paragraph 5.29 of the Licensing, compliance and enforcement policy (LCE) which had not been proposed.

In line with our standard procedure for the publication of sanctions licensees are provided with the wording in advance of publication on the register and are able to provide representations. On that basis we have decided not to remove that we will set out in the publication the financial penalty we would have imposed prior to any reduction on affordability grounds.

Final wording

This requirement will come into force on 10 October 2025.

Paragraphs 2.30 to 2.33 of the amended SoPfDFP

Step 6 Affordability

2.30. The total amount to be paid by the licensee will be either the sum of the figures determined at Step 1 (if calculated) and Step 5, or Step 5 alone if no figure is calculated at Step 1.

2.31. It is recognised that the impact of financial penalties on licensees may differ depending on the nature of the licensee. Accordingly, the Commission may consider a reduction on affordability grounds if the total penalty is likely to cause significant financial hardship such as to endanger the solvency of the licensee or its ability to continue trading.

2.32. The Commission may request financial information regarding the financial resources available to a licensee, including but not limited to its own resources and those of any parent or group company or ultimate beneficial owner as set out at paragraph 5.29 of LCE. In the absence of sufficient information to the contrary, the Commission will conclude that the licensee has the resources to pay such financial penalty as is appropriate in the circumstances of the case.

2.33. In circumstances where the total has been reduced at this step, the Commission will still set out the financial penalty it would have imposed (prior to any reduction on affordability grounds) in its sanctions register and any other publications.

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Proposal 14: Step 5 - Discount for early resolution Next section
Proposal 16: Step 7 - Proportionality
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