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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 two: Monitoring Performance Framework
  3. 6. Monitoring Performance Framework context

6. Monitoring Performance Framework context

6.1 This volume provides guidance for certain Fourth Licence and Section 6 Licence conditions and concepts where we consider such guidance will support the delivery of our statutory duties. Our guidance includes aspects of compliance, alongside further detailed information on areas such as the Licensee Exit Plan and potential adjustments under the Incentive Mechanism. We provide an overview of how this volume interacts with the other volumes of this Regulatory Handbook and our wider Regulatory Model in the background section of this document.

6.2 We include guidance in the form of examples of the types of factors and evidence we may consider relevant when assessing compliance, including in the context of scrutinising specific areas where we have concerns or consider there is a potential compliance risk. The examples we use are illustrative.

6.3 As well as the specific types of factors and evidence discussed in the remainder of this volume, in general we will also take into account the extent to which the Licensee has implemented (or has failed to implement) its Application or any element of that Application12, in assessing whether the Licensee has achieved the outcomes set out in the Fourth Licence. Consistent with our regulatory approach, which aims to provide flexibility to the Licensee, we will take into account that the Licensee’s approach may reasonably change in order to meet the outcomes set out in the Fourth Licence. Therefore, it is possible for deviations from the Application to be aligned with the requirements of the Fourth Licence, for example due to changes in market circumstances since the date of the Application.

6.4 In order to monitor Licensee performance as well as relevant trends and developments, we will have regard to a number of information sources related to different areas of compliance. As a matter of course, and where we are comfortable that the outcomes set out in the Fourth Licence are being achieved, we will not scrutinise in detail all steps taken and due diligence exercised by the Licensee. However, where we have particular concerns or identify potential compliance risk(s), we may scrutinise specific areas of the Licensee’s conduct more closely13.

6.5 Information sources may include:

  • relevant information or evidence provided by the Licensee as part of the Annual Assurance Statement or as part of Ad Hoc Assurance Statements, as discussed in our Assurance and Regulatory Reporting Requirements (see volume three)
  • periodic information reports provided by the Licensee as described in our Assurance and Regulatory Reporting Requirements
  • any other relevant Lottery Information we may access or request from time to time (in accordance with Condition 23), including in any instances where we have specific issues or concerns
  • any other relevant information or evidence held or collected by us (for example through surveys) or where appropriate, by third parties

6.6 The rest of volume two is structured as follows:

  • section 7 provides guidance on certain general concepts used in the Fourth Licence and Section 6 Licences
  • section 8 provides guidance on compliance for Condition 1: Purpose and outcomes
  • section 9 provides guidance on compliance for Condition 5: Fitness and Propriety of the Licensee
  • section 10 provides guidance on compliance for Conditions 6 and 7: Fitness and Propriety of Critical Function Employees, Lottery Beneficiaries and Lottery Supervisors
  • section 11 provides guidance on compliance for Condition 8: Protecting Participants’ Interests
  • section 12 provides guidance on compliance for Condition 9: Ensuring Access to the National Lottery
  • section 13 provides guidance on compliance for Condition 11: Having an appealing but safe portfolio of Games
  • section 14 provides guidance on compliance for Condition 13: The National Lottery Brand and reputation
  • section 15 provides guidance on compliance for Condition 17: Licensee and its operations to be Fit for Purpose
  • section 16 provides guidance for Condition 18: Financial and Operational Resilience, specifically in relation to Significant Business Events and providing context for Condition 18.20 (Change in Gambling Law or Fundamental Geographic Scope Change)
  • section 17 provides further information on the expected contents of the Exit Cooperation Agreement and Exit Plan, which are required under Condition 27: Exit
  • section 18 provides further guidance on Condition 28: Outstanding Liability Fund
  • section 19 provides further information and detail to support with implementation of adjustments contained in Schedule 5: Good Causes Contribution
  • section 20 provides information and context related to Section 6 Licences.

6.7 Unless otherwise stated, references to specific Licence conditions refer to the Fourth Licence.

References

12Save to the extent the same has been varied in accordance with the Enabling Agreement.
13Further details on our approach to investigations are set out in our Enforcement Policy (see volume four).

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7. General concepts used in the Fourth Licence and Section 6 Licences
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