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Licensees responsibilities for third parties

We have requirements in our Licence Conditions and Codes of Practice (LCCP) which set out the obligation’s licensees must adhere to when contracting with third parties. We have also provided advice on several different areas where licensees contract with third parties.

Responsibilities for third parties

The LCCP social responsibility code LCCP: 1.1.2 - Responsibility for third parties – all licences makes clear that licensees are responsible for the third parties that they contract with. It also requires licensees to ensure that any contracted third parties conduct themselves in so far as they carry out activities on behalf of the licensees as if they were bound by the same licence conditions and subject to the same codes of practice.

The Gambling Commission expects that licensees will obtain the necessary assurance by conducting adequate due diligence on the third party to ensure (amongst other things) that they are competent and reliable.

Any licensee that relies on a third party to conduct any aspect of their business related to the licensed activities must ensure it has sufficient oversight and controls in place to ensure all activities are carried out in accordance with the LCCP, notably, but not exclusively, social responsibility and anti-money laundering requirements.

Warning Failure to maintain adequate control of third parties can result in regulatory action including suspension or the loss of the operating licence.

Licensees are aware that an operating licence is required to provide facilities for gambling (unless a specified exemption applies). Licensees must ensure that their arrangements with third parties do not result in an offence under section 33 of the Gambling Act 2005 (opens in a new tab).

1.1.2 Responsibility for third parties for all licences

The following code is relevant to this section: LCCP: 1.1.2 - Responsibility for third parties – all licences.

This requirement applies to all licensees who contract with third parties for the provision of any aspect of their business related to the licensed activities.

1.1.3 Responsibility for third parties for remote licences

The following code is relevant to this section: LCCP: 1.1.3 - Responsibility for third parties – remote.

This requirement applies to remote licensees.

White label partnerships

The responsibility for compliance of all operating gambling websites, including white labelled sites, sits with the licence holder and cannot be transferred to any other party.

Failure to ensure the following at all times may bring into question the suitability of a gambling business to hold a licence:

  • a licensee’s business is conducted in a way which minimises the risk to the licensing objectives
  • our Licence Conditions and Codes of Practice (LCCP) are being complied with.

Licensees must know their customers and be able to demonstrate knowledge, oversight and proactive interactions where appropriate. Any interventions must be completed in a timely manner.

For information on how licensees should conduct white label partnerships, see section 7 - White Label Partnerships of the Compliance and Enforcement Report 2019 to 2020.

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