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Change of corporate control

What you need to do if there is a new controller of your business either through purchase of shares, dividends or influence.

Published: 17 May 2021

Last updated: 7 March 2024

This version was printed or saved on: 19 April 2024

Online version: https://www.gamblingcommission.gov.uk/licensees-and-businesses/guide/change-of-corporate-control

Overview: ## Controller

Under Section 102 of the Gambling Act 2005 (opens in a new tab), a company limited by shares and a holder of an operating licence (“the company”) must notify the Commission when a person (or entity) becomes a new controller of the company.

See Section 422 of Financial Services and Markets Act 2000 (FSMA 2000) (opens in a new tab) but, in summary, a person (or entity) is considered a controller if they hold:

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.

“Parent undertaking” is defined in section 1162 of the Companies Act 2006 (opens in a new tab)

“Shares” are defined in section 422(4) Financial Services and Markets Act 2000 (opens in a new tab)

“Voting power” is defined in section 422 Financial Services and Markets Act 2000 (opens in a new tab)

Shares

Shares are defined as:

  1. in relation to a licensee with a share capital, means allotted shares
  2. in relation to a licensee with capital but no share capital, means rights to share in the capital of the undertaking
  3. in relation to a licensee without capital, means interests:
    1. conferring any right to share in the profits, or liability to contribute to the losses, of the undertaking
    2. giving rise to an obligation to contribute to the debts or expenses of the undertaking in the event of a winding up.

Voting power

  1. includes in relation to a person (H):
    1. 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.
    2. 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.
    3. voting power attaching to shares which are lodged as collateral with H, provided H controls the voting power and declares an intention to exercise it.
    4. voting power attaching to shares in which H has a life interest.
    5. voting power which is held, or may be exercised within the meaning of subparagraphs (i) to (iv), by a F2 controlled undertaking of H
    6. voting power attaching to shares deposited with H which H has discretion to exercise in the absence of specific instructions from the shareholders
    7. voting power held in the name of a third party on behalf of H.
    8. 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
  2. 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

Please make sure you read the guidance notes before you start to complete the application.

Changes of control must be reported as a key event as soon as reasonably practicable and in any event within 5 working days of the licensee becoming aware of the event’s occurrence.

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 may 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 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.

Source of funds evidence

Source of funds evidence is usually required for the funds used to acquire the controlling interest and any intended ongoing investment in the Licensee. This is a general overview of when and what source of funds evidence is required but we assess each application on a case-by-case basis according to risk so the type and level of evidence may differ between applications.

We consider there are three main categories of funding:

Regulated means by the Financial Conduct Authority (FCA) in the United Kingdom (UK) and FCA equivalent in other jurisdictions, for example the United States equivalent would be the Securities and Exchange Commission (SEC). 

We would not normally require source of funds evidence in relation to the origin of monies when an operator takes out a loan from a UK regulated bank, but if an investor borrows from a UK regulated bank to invest in an operator, we will normally undertake source of funds checks on the period when the monies were in the investor’s control. If any bank is buying shares in the operator, we will undertake source of funds checks on the bank, as explained on this page.

Funding from unregulated individuals

These are typically private investors who are investing their own money. We require source of funds evidence if the individual has provided £50,000 (or equivalent in foreign currency) or more of the funding for the acquisition or ongoing investment. Evidence of the individual’s source of funds will depend on what the source of funds is but examples include bank statements, investment portfolio statements and P60s.

Funding from unregulated entities

These investors are typically entities using their own money to fund the investment. For these investors we need to know when they were created or incorporated, what jurisdiction they are registered in, and we require source of funds evidence if they have been:

Typically for established entities the latest set of filed financial statements can be sufficient evidence. For recently established entities, evidence of how the entity has been funded is required.

Funding from regulated banks or investment companies

These investors are regulated banks or entities investing their own money. When we consider what type of source of funds evidence is required, we group these investors into two categories – FCA regulated and overseas equivalent regulated.

For FCA regulated entities, we require its FCA reference number along with source of funds evidence if it is investing 10 percent or more of the total investment amount (that is, 10 percent of the total borrowed or 10 percent of the monies raised via the issue of new shares). Typically, these investors are established entities and the latest set of filed financial statements can be sufficient evidence.

For overseas equivalent regulated entities, we require its reference number with the regulator. If it is investing 5 percent or more of the total investment amount, we also require source of funds evidence. Typically, these investors are established entities and the latest set of filed financial statements can be sufficient evidence.

Funding from regulated banks or investment companies acting as an intermediary

These investors are regulated banks or entities acting as an intermediary for an investor or pool of investors (that is, the entity is not investing its own money). When we consider source of funds evidence, we group these investors into two categories – FCA regulated and overseas equivalent regulated.

For FCA regulated entities, we require its FCA reference number and, if it is investing 10 percent or more of the total investment amount, we require a schedule of the underlying investors.

For the underlying investors, we require source of funds evidence for:

  1. individual private investors investing £50,000 (or equivalent in foreign currency) or more
  2. non-regulated entities created or incorporated for more than 12 months at the date of investment and investing £1,000,000 (or equivalent in foreign currency) or more
  3. non-regulated entities created or incorporated for less than 12 months at the date of investment and investing any amount
  4. regulated entities investing 5 percent or more of the overall total investment amount.

For overseas equivalent regulated entities, we require its reference number with the regulator and, if it is investing 5 percent or more of the total investment amount, we require a schedule of the underlying investors.

For the underlying investors, we require source of funds evidence for:

  1. individual private investors investing £50,000 (or equivalent in foreign currency) or more
  2. non-regulated entities created or incorporated for more than 12 months at the date of investment and investing £1,000,000 (or equivalent in foreign currency) or more
  3. non-regulated entities created or incorporated for less than 12 months at the date of investment and investing any amount
  4. regulated entities investing 5 percent or more of the overall total investment amount.

Trusts

The Gambling Commission’s application disclosure requirements for Trusts are the same as those for other entity types and/or 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 percent or above interest in the licensee, in your application, you must include:

  1. a copy of the trust deed
  2. a copy of the letter of wishes
  3. a copy of the letter of consent from the trustees (for example, that they have consented to act as trustees)
  4. .

Trust beneficiaries

We require an Annex A from those beneficiaries whose interest in the Trust equates to a 10 percent or more controlling interest in the applicant and/or licensee or a parent undertaking of the 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 percent but 3 percent 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 from all Trustees where the Trust’s interest in the applicant and/or licensee equates to a 10 percent or more controlling interest in the applicant and/or licensee (or a parent undertaking thereof). 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 less than 10 percent but 3 percent 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.

Estates

If the license holder has passed away, please let us know. The death of someone is always a difficult time and we aim to make any changes to a licence as simple as possible, and a copy of the death certificate is not needed.

If the bereavement results in a change of corporate control, for example shares are redistributed within a family or with shareholders, or probate is involved and the estate is complex, please let us know as soon as possible so we can work with you to ensure any changes to the licence are dealt with as soon as we can.

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.

Information needed

Ownership structure diagrams

This must show all individuals and companies that have an interest of over 3 percent in the Licensee.

If the Licensee has become part of a group because of the Change of Corporate Control a group structure will need to be provided showing all entities in the group and identifying all parent undertakings of the licensee.

Management structure diagram

If the management structure has changed because of the new controller.

Evidence to show the Licensee is controlled by the new controller

We require a copy of the share purchase agreement and documentation confirming the shares and/or voting power has transferred to the new controller, this may be in the form of share certificates or share register.

Limited companies

The following are needed for changing limited companies:

  1. articles of association for new controllers
  2. certificate of incorporation for all new controllers
  3. memorandum of association for new controllers.

Trust documents for new controllers

These are needed only where a trust is involved in the ownership of the Licensee as a result of the change of control and the trust has more than 3 percent interest in the Licensee.

We require a copy of the following:

  1. trust deed
  2. letter of wishes if applicable
  3. copy of letter of consent from trustees if applicable
  4. .

LCCP policies and procedures

This is needed if there are new or amended policies because of the change of corporate control.

Copies of gambling licences

This is needed if the new controller is licensed elsewhere.

Business plan

This is needed if changed because of the change of corporate control.

Source of funding evidence

This is needed alongside clear explanation. This can be in the form of but not limited to bank statements, audited accounts.

Purchase price evidence

Evidence from the buyer to the seller is required, alongside a clear explanation.

Profit and loss projections

This is needed if the ongoing funding of the business is changing we will need profit and loss projections for the next 12 months.

Online Personal Management Licence applications

If there is a change to the management structure because of the change of corporate control, Online Personal Management Licence applications and required supporting documents from each person responsible for a management office or Online Annex A Personal Declaration if the new controller is a Small-Scale Operator.

Online Annex A personal declarations

Online Annex A Personal Declarations from all new individuals who have more than 10 percent control of the Licensee because of the change of corporate control and if a Trust is involved in the new controller's ownership structure Online Annex A Personal Declarations from:

  1. all trustees
  2. all beneficiaries aged 18 years and over through their holding in a trust have more than 10 percent control of the Licensee.
  3. If the trustee is a company an Annex A Personal Declaration will be required from the person in the company who has lead responsibility for matter relating to the trust.

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
Where the new controller does not hold an operating licence 75 percent of standard application fee for the highest value activity on the licence or licences held by the Licensee. If two or more Licensees are affected by the change, 75 percent is of the highest value activity held by all the Licensees affected with the fee being £160 for each of the other Licensee.
Where the new controller already holds an operating licence 25 percent of standard application fee for the highest value activity on the licence or licences held by the Licensee. If two or more Licensees are affected by the change, 25 percent is of the highest value activity held by all the Licensees affected.
Where the new controller is a financial institution that is either regulated by the FCA or which has its registered or head office in an EEA state and is regulated by its home state regulator. 25 percent of standard application fee for the highest value activity on the licence or licences held by the Licensee. If two or more Licensees are affected by the change, 25 percent is of the highest value activity held by all the Licensees affected with the fee being £160 for each of the other Licensee.
Where the new controller is a financial institution that is either regulated by the FCA or which has its registered or head office in an EEA state and is regulated by its home state regulator. 25 percent of standard application fee for the highest value activity on the licence or licences held by the Licensee. If two or more Licensees are affected by the change, 25 percent is of the highest value activity held by all the Licensees affected with the fee being £160 for each of the other Licensee.
Regulation 34 (2) gives a provision for a reduced fee if a company is being inserted into the group structure and both the following conditions are met:
  1. 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)
  2. the new controller is only acquiring 10percent shares or increasing their shareholding to a 10 percent position and nothing else (such as, the where the shareholding does not confer any “voting power” as defined in 422 of FSMA).
£160, otherwise, if these conditions are not met 25 percent of standard application fee for the highest value activity on the licence or licences held by the Licensee.
Inserting a company into a Licensee structure only if the new controller holds an operating licence or is a financial institution regulated by the FCA or an equivalent regulator in an EEA state and the new controller is only acquiring 10percent shares or increasing their shareholding to 10percent and nothing else (such as, where the shareholding does not confer “voting power” as defined in section 422 FSMA) £160
Due to share fluctuation (only acquiring 10 percent shares or increasing their shareholding to above 10 percent and nothing else (for example where the shareholding does not confer “voting power” as defined in section422 FSMA) only if the new controller holds an operating licence or is a financial institution regulated by the FCA or an equivalent regulator in an EEA state, and the new controller is only acquiring 10percent shares or increasing their shareholding to 10 percent and nothing else (such as, where the shareholding does not confer “voting power” as defined in section 422 FSMA) £160
New controller in family-owned small-scale operator and:
  1. the operator is a private limited company
  2. the operator is and will continue to be a small-scale operator
  3. all existing shareholders are either the spouse, civil partner, child, parent, or sibling of the new controller
  4. all existing shareholders are either the spouse, civil partner, child, parent, or sibling of the new controller
  5. the new controller will not exercise any management function in connection with the gambling activities
  6. the new controller will not hold a higher percentage of shares in the company than any other shareholder
£160

Fees examples

Known controller

A known controller is a company who holds an operating licence or where the new controller is a financial institution that is either regulated by the FCA or which has its registered or head office in an EEA state and is regulated by its home state regulator. By this we mean commercial banks, investment banks, brokerage firms, insurance companies, or asset management funds.

5 percent of the usual application fee for the highest value activity on the licence held by the operator affected.

If the operator holds both non-remote and remote (not ancillary) licences, it is the highest value activity across both licences.

Examples of operator holds include:

  1. non-remote general betting standard category A2, usual application fee £879 (increases from 6 April 2022)
  2. remote general betting standard real events category G1 – usual application fee £10,323 (from 1 October 2021) and remote gambling software category G1 – usual application fee £18,746 (from 1 October 2021)
  3. chance of corporate control fee is 25 percent of £18,746.

Known Controller affecting a group

This also applies to 2 or more operators (not necessarily in the same group make change applications at the same time in respect of the same controller.

The operator with the highest value activity of all the licences held by the group is charged the 25 percent rate above, and £160 each group company.

Unknown Controller

Change includes at least one incoming controller that does not hold an operating licence and is not a financial institution that is either regulated by the FCA or which has its registered or head office in an EEA state and is regulated by its home state regulator.

75 percent of the usual application fee for the highest value activity on the licence held by the operator affected.

If the operator holds both non-remote and remote (not ancillary) licences, it is the highest value activity across both licences.

Examples of operator holds include:

  1. non-remote general betting standard category A2 - usual application fee £879 (increases from 6 April 2022)
  2. remote general betting standard real events category G1 – usual application fee £10,323 (from 1 October 2021) and remote gambling software category G1 – usual application fee £18,746 (from 1 October 2021)
  3. change of corporate control fee is 75 percent of £18,746

Unknown controller affecting a group

This also applies to 2 or more operators (not necessarily in the same group make change applications at the same time in respect of the same controller.

The operator with the highest value activity of all the licences held by the group is charged the 25 percent rate above, and £160 each group company.

Share fluctuation

This also includes all incoming parties known (same definition as in known controllers previously mentioned) to the Commission.

The fee is £160 for each group company.

Family-owned small-scale operators

All the following apply:

  1. the operator is a private limited company
  2. the operator is and will continue to be a small-scale operator
  3. all existing shareholders are either the spouse, civil partner, child, parent, or sibling of the new controller
  4. the new controller will not exercise any management function in connection with the gambling activities
  5. the new controller will not hold a higher percentage of shares in the company than any other shareholder.

The fee is £160 for each group company.

Inserting a company into a licensee’s structure

When a company is inserted to the structure, they are a new controller; it does not matter if the ultimate beneficial owner remains the same.

25 percent or 75 percent of the usual application fee for the highest value activity on the licence held by the operator affected depending on whether the inserted company is known or unknown (same definitions as in known and unknown controllers previously mentioned) and does not meet all the requirements set out as follows.

Holding company 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 holding company is only acquiring 10 percent shares or increasing their shareholding to a 10 percent position and nothing else (such as, the where the shareholding does not confer any “voting power” as defined in 422 of FSMA)