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Change of corporate control

Controller

Under Section 102 of the Gambling Act 2005 (opens in a new tab), a change of corporate control takes place when a person (or other legal entity) either directly or indirectly:

  • owns 10% or more of the shares
  • is entitled to 10% or more of the rights to profits/dividends
  • has 10% or more of the voting power
  • is able to exercise significant influence over the management of an existing licensed operator.

See Section 422 of Financial Services and Markets Act 2000 (FSMA) (opens in a new tab) for the full definition of controller.

In summary, it is when there is a new "controller" of the company. For example, if a major investor joins the company or a new significant member joins a partnership. A person is considered a new controller if they hold:

  • 10% or more of the shares in a licensed operator or in parent company of a licensed operator
  • 10% or more of the voting power in a licensed operator or a parent company of a licensed operator
  • shares or voting power in a licensed operator or a parent company of a licensed operator as a result of which the person is able to exercise significant influence over the management of a licensed operator.

Shares

The holding of shares or voting power by a person in the licensed operator includes any shares or voting power held by another person if they and the other person are acting together:

  • in relation to a licensee with share capital, allotted shares
  • in relation to a licensee with capital but no share capital, rights to share in the capital.

In relation to licensee without capital, interests:

  • conferring any rights to share in the profits of the licensee; or liability to contribute to the losses of the licensee
  • giving rise to an obligation to contribute to the debts or expenses of the licensee in the event of its winding up (in a licensee with neither share capital nor capital).

Voting power is defined by section 422(5) FSMA20000

(a) it includes in relation to a person (H):

i. voting power held by a third party with whom H has concluded an agreement, which obliges H and the third party to adopt, by concerted exercise of the voting power they hold, a lasting common policy towards the management of the undertaking in question.

ii. voting power held by a third party under an agreement concluded with H providing for the temporary transfer for consideration of the voting power in question.

iii. voting power attaching to shares which are lodged as collateral with H, provided that H controls the voting power and declares an intention to exercise it.

iv. voting power attaching to shares in which H has a life interest.

v. voting power which is held, or may be exercised within the meaning of subparagraphs (i) to (iv), by a F2 controlled undertaking of H.

vi. voting power attaching to shares deposited with H which H has discretion to exercise in the absence of specific instructions from the shareholders.

vii. voting power held in the name of a third party on behalf of H.

viii. voting power which H may exercise as a proxy where H has discretion about the exercise of the voting power in the absence of specific instructions from the shareholders.

(b) in relation to an undertaking which does not have general meetings at which matters are decided by the exercise of voting rights, means the right under the constitution of the undertaking to direct the overall policy of the undertaking or alter the terms of its constitution.

If you have any questions as to whether a change of control has taken place, you should seek independent legal advice.

Notify the Commission of a change of corporate control

Changes of control must be reported as a key event as soon as possible and not later than within 5 working days.

Within 5 weeks of the change occurring you must either surrender the licence or apply for the licence to continue to have effect or it will be revoked.

If you want to apply for the licence to continue to have effect, you must complete a Change of Corporate Control form, and pay the appropriate fee. You must email the completed form and supporting documents to licensing@gamblingcommission.gov.uk. Do not post them to us and do not email them to a Licensing team member email address.

Incoming individuals who have or are expected to become controller of the licensed operator, if not already approved by the Commission will be required to submit an Annex A Personal Declaration or personal management licence (PML) application.

Make sure you read the guidance notes on this page before you start to fill out the form.

Change of corporate control applications typically take around 12 weeks to process, providing full information is submitted.

What you need to send us with your application

Make sure you read the guidance notes for the information you must send in with the application. If any information is missing, it will delay the application.

Trusts

The Commission’s application disclosure requirements for Trusts are the same as those for other entity types/individuals that are part of a licensee’s ownership structure.

However, it is important to note that whilst the disclosure requirements set out below are general principles of the information required to support an application, the Commission retains the right to request further information or documents when this is required.

Where the Trust’s ownership equates to 3% or above interest in the licensee, n your application, you must include:

  • a copy of the trust deed
  • a copy of the letter of wishes
  • a copy of the letter of consent from the trustees (i.e. that they have consented to act as trustees).

Trust beneficiaries

We require an Annex A personal declaration from those beneficiaries whose interest in the Trust equates to a 10% or more controlling interest in the applicant/licensee. The Annex A must be submitted online through our Apply for a personal licence service. If any beneficiary is under 18, then we do not require an Annex A from them.

If the beneficiary’s interest in the Trust equates to less than 10% but 3% or more, then we require the name, address, and date of birth of all beneficiaries which should be shown in the trust deed – if not, you must provide this information.

Trustees

We require an Annex A personal declaration from all Trustees where the Trust’s interest in the applicant/licensee equates to a 10% or more controlling interest in the applicant/licensee. The Annex A must be submitted online through our Apply for a personal licence service.

In the case of the Trustee being a company, we require an Annex A from the person or people in that company who have lead responsibility for matters relating to the Trust.

If the Trust’s interest in the licensee equates to equates to less than 10% but 3% or more, we require the name, address and date of birth of all Trustees which should be shown in the trust deed – if not, you must provide this information.

Settlor

We will not usually require an Annex A from the Settlor. We require the name, address and date of birth of the Settlor which should be shown in the trust deed – if not, you must provide this information.

Protector

We will not usually require an Annex A from the Protector. We require the name, address and date of birth of the Protector which should be shown in the trust deed – if not, you must provide this information.

Applications in advance

Section 103 of the Gambling Act 2005 (opens in a new tab) provides for this. An application can be made in respect of a person or entity who is expected to become a controller of a company.

Fees for a change of corporate control application

When submitting the Change of Corporate Control application, you must pay the correct fee for the application at the same time. This can be paid by BACS or Faster Payments. Find out more about paying fees. The fee must be paid on the same date you email the application to us.

You can find out the application fee for your licence by using our Fee calculator service.

Fees

Changes and fees
Change Fee
Due to share fluctuation only (the controller(s) must be known to the Commission, that is, they must hold an operating licence issued by the Commission or be a financial institution that is either regulated by the FCA or which has its registered/head office in an EEA state and is regulated by its home state regulator). £160
Where the new controller already holds an operating licence 25% of standard application fee
Where the new controller is a financial institution that is either regulated by the FCA or which has its registered/head office in an EEA state and is regulated by its home state regulator. 25% of standard application fee
Where the new controller does not hold an operating licence 75% of standard application fee
New controller in family owned small-scale operator and:
  • the operator is a private limited company
  • the operator is and will continue to be a small-scale operator
  • all existing shareholders are either the spouse, civil partner, child, parent or sibling of the new controller
  • the new controller will not exercise any management function in connection with the gambling activities
  • the new controller will not hold a higher percentage of shares in the company than any other shareholder.
£160
Regulation 34 (2) gives a provision for a reduced fee if a company is being inserted into the group structure and both the below conditions are met:
  • the new controller is known to the Commission (that is, they hold an operating licence or they are a financial institution regulated in the EEA etc) and
  • the new controller is only acquiring 10% shares or increasing their shareholding to a 10% position and nothing else (i.e. the where the shareholding does not confer any “voting power” as defined in 422 of FSMA).
£160

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