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  3. Fourth National Lottery Licence: Regulatory Handbook

Policy

Fourth National Lottery Licence: Regulatory Handbook

The Commission’s regulatory handbook sets out our regulatory approach to the National Lottery.

Published
1 February 2024

Last updated
1 February 2024 - Changes

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  1. Contents
  2. Volume four: Enforcement Policy  
  3. 33. Enabling Agreement and Fourth Licence: Concurrent Enforcement

33. Enabling Agreement and Fourth Licence: Concurrent Enforcement

33.1 The original purpose of the Enabling Agreement (EA) was to govern the implementation by the Incoming Licensee of its Application. The Fourth National Lottery Licence (the “Licence”) would only be granted if and when the Incoming Licensee had complied with its obligations of the EA and fully implemented its Application (“Fully Implemented Commencement” or “FIC”).

33.2 The Licence will now be granted before FIC has been achieved. The EA continues until FIC is achieved (and for a period thereafter), If the Licence is granted as currently expected on the Start Date (1 February 2024), the EA will now continue for a period following award of the Licence whilst implementation continues.

33.3 This means that the EA will continue to be in force alongside the Licence. The Licence, at condition 26.4, will require Allwyn to comply with the provisions of the EA. During this period acts or omissions of Allwyn which constitute a breach of the EA will also constitute a breach of that requirement in the Licence.

33.4 This section of the Enforcement Policy relates to acts or omissions which constitute a breach of the EA and the Licence (“Relevant Breach”) in the context that:

  1. the EA places specific requirements on the Licensee to ensure that FIC is achieved whereas the Licence is largely based on the achievement of outcomes based on a fundamental proposition of FIC having been achieved
  2. Any delay in achieving FIC, or failure to achieve FIC as contemplated by the EA and the Licensee’s Application could have a direct and adverse impact on the achievement of the Commission’s statutory duties such as the protection of players, ensuring the propriety of the National Lottery and the maximisation of returns to good causes.

33.5 If the Commission becomes aware of a fact or circumstance which might give rise to or constitute a Relevant Breach, it will discuss the matter with Allwyn at the Incoming Transition Governance Board (ITGB) which will continue to operate throughout the period leading up to FIC.

33.6 ITGB will be used primarily to discuss strategic issues but will also provide an opportunity for the Commission to raise concerns and seek appropriate resolution. However, ITGB will not be a forum for enforcement decisions or legal resolution; discussion at ITGB will be without prejudice to the Commission’s formal decision making and enforcement functions.

33.7 A Relevant Breach may be taken into account when determining whether Allwyn achieves FIC and when considering whether to grant a Licence extension.

33.8 If the Commission considers there has been a Relevant Breach, it will consider the range of rights and powers available to it with respect to that breach under the EA, the Licence and the National Lottery Act 1993 and determine the most appropriate course of action on the basis of its statutory duties and taking account of the Commission’s Enforcement Policy as well as all relevant factors including (but not limited to):

  1. the particular nature and potential impact of Relevant Breaches when compared with other licence breaches
  2. the severity of the breach and the significance of its impact
  3. whether the breach results in FIC not being achieved as required by the EA, or creates a material risk FIC will not be achieved as required by the EA
  4. whether the breach involves repeated non-compliance with similar requirements of the EA and/or the Licence or arises from a failure by the Licensee to comply with an Implementation Direction
  5. the Licensee’s response to the breach including the provision of prompt notification to the Commission and/or prompt resolution.

33.9 When considering whether a financial penalty should be pursued under the Enabling Agreement or the Licence, consideration will be taken by the Commission of any remedy already applied in respect of the same facts and/or circumstances.

33.10 A record will be kept of any Relevant Breach. This will include if, when and how it was resolved, including any enforcement action taken. The Commission will also consider publication of the decision in line with the Enforcement Policy.

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32. Publication of our decision
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