Pool betting - recording Gross Gambling Yield
On Pool betting licensing arrangements we acknowledge that operators are using a number of models to provide facilities for pool betting, or what at first sight appears to be pool betting, to consumers in Great Britain (GB).
Dependent upon the arrangements in place some betting contracts are struck in reliance of a pool betting licence whilst others are struck in reliance of a general betting standard licence.
Whenever an operator accepts a bet in reliance of its own licence, the GGY must be recorded within the respective regulatory return and will be considered for fee category purposes. A Commission licence is relied upon if the customer involved in your bet is located in GB or any part of your remote gambling equipment is located here.
Whenever a licensed operator makes or accepts a bet on behalf of another licensee it is the other licensee (the actual counterparty to the bet) which must record and consider the GGY for regulatory return and fee category purposes.
Operators providing facilities by non-remote and remote means must ensure that the GGY is recorded against the appropriate licences. As a reminder, remote gambling means gambling in which persons participate by use of remote communication. If participation isn’t by use of remote communication then its non-remote gambling.
We expect all licensees to regularly review their levels of GGY to ensure they are located within the correct fee category. You must submit a licence variation if your fee category needs to change. Applications to vary an operating licence can take up to eight weeks to process.
Loyalty schemes such as ‘VIP cash back’ or ‘rebates’ should not be counted when calculating GGY. Such payments do not form part of a gambling transaction and are considered to be part of the costs of conducting business such as payments to affiliates for the acquisition of players.
For example, a customer with a 5% rebate on their stakes places £100 of bets into a pool. The total stakes into the pool are £1000 and the deduction level is 20%. GGY is £200 (20% of £1000) and NOT £195 (20% of £100 – 5% of £100). The £5 the operator returns to the customer as a rebate is not deducted from GGY and (on the basis it is now cash) if it is wagered in another pool it would count towards amount staked in that pool.