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Policy

Statement of principles for licensing and regulation

The Commission's statement of principles for licensing and regulation.

  1. Contents
  2. 4 - Principles for regulation

4 - Principles for regulation

Introduction

4.1 The Commission expects licensees to conduct their gambling operations in a way that does not put the licensing objectives at risk. The Licence Conditions and Codes of Practice are designed to ensure this. The Commission will apply the following principles in exercising its regulatory functions under the Act.

Operating licence holders

4.2 The Commission expects operators to:

  • conduct their business with integrity
  • act with due care, skill, and diligence
  • take care to organise and control their affairs responsibly and effectively and have adequate systems and controls to minimise the risks to the licensing objectives
  • maintain adequate financial resources
  • have due regard to the interests of consumers and treat them fairly
  • have due regard to the information needs of consumers and communicate with
  • them in a way that is clear, not misleading, and allows them to make a properly informed judgment about whether to gamble
  • manage conflicts of interest fairly
  • work with the Commission in an open and co-operative way
  • comply with both the letter and spirit of their licence and associated Commission regulations
  • disclose to the Commission anything which the Commission would reasonably expect to know.

Senior positions and Personal Management Licence holders

4.3 The Commission expects those occupying senior positions, whether or not they hold Personal Management Licences, to:

  • uphold the licensing objectives and ensure compliance of operators with the LCCP
  • organise and control their affairs responsibly and effectively
  • have adequate systems and controls to keep gambling fair and safe
  • conduct their business with integrity
  • act with due care, skill and diligence
  • maintain adequate financial resources
  • have due regard to the interest of consumers and treat them fairly
  • have due regard to the information needs of consumers and communicate with them in a way that is clear, not misleading, and allows them to make an informed judgment about whether to gamble
  • manage conflicts of interest fairly
  • disclose to the Commission anything which the Commission would reasonably expect to know
  • work with the Commission in an open and cooperative way
  • comply with both the letter and spirit of their licence, the licence of their operator, and associated Commission regulations.

Personal Functional Licence holders

4.4 The Commission expects those holding Personal Functional Licences to:

  • conduct themselves with integrity
  • act with due care, skill and diligence
  • have due regard to the interests of consumers and treat them fairly
  • work with the Commission in an open and co-operative way
  • disclose to the Commission anything which the Commission would reasonably expect to know
  • keep their skills and knowledge up to date.

Dealing with issues that put the licensing objectives at risk

4.5 In approaching matters that put the licensing objectives at risk, the Commission’s concern is to protect consumers and the wider public, and to raise standards in the gambling industry through targeted action. Our aims are to: reduce the risks to the licensing objectives; ensure that any lessons are shared with the wider gambling industry; and, deter other operators from acting in the same way. Where concerns have been raised about a licensee the Commission may commence an investigation. The approach adopted will be based on an assessment of the risks, the wider circumstances of the case and the range of options available.

Licence reviews

4.6 The Commission may move to formally review a licence by virtue of its powers under section 116 of the Act. Where a formal review has been carried out, the Commission may go on to exercise its regulatory powers under section 117 of the Act.

Regulatory settlement

4.7 The Commission may seek, where appropriate, to fulfil its statutory obligations and pursue the licensing objectives through means that stop short of formal licence reviews under section 116 of the Act. One means for achieving this will be by way of regulatory settlement, which the Commission may consider where a licensee is:

  • open and transparent in its dealings with the Commission
  • able to make timely disclosures of material facts to the Commission
  • able to demonstrate that they have insight into apparent failings
  • able to suggest actions that would prevent the need for formal action by the Commission
  • prepared, where appropriate, to agree to the publication of a public statement by the Commission setting out the failings in order to deter future non-compliance by others and/or share learning that may be beneficial to the wider industry or other stakeholders including the public
  • prepared to divest itself of any gross gambling yield or cost savings which accrued as a result of the failings
  • prepared to follow advice and implement procedures to ensure there is no repetition of failings
  • prepared to contribute to the direct costs to the Commission of investigating the matter in respect of which regulatory settlement is sought
  • prepared to volunteer a payment in lieu of the financial penalty the Commission might otherwise impose for breach of a licence condition in accordance with the Statement of Principles for Determining Financial Penalties.

4.8 Where a formal review has started but a licensee makes full disclosure of all the relevant facts and makes appropriate admissions, the Commission may consider if its investigations need to continue. At this point the Commission may consider whether it is prepared to agree the facts and an appropriate outcome, or in certain cases what action short of the equivalent of a formal sanction should be taken.

4.9 Regulatory settlements can allow the Commission to avoid a formal licence review or to conclude such a review more swiftly than would often be the case but will only be appropriate where they meet the same appropriate regulatory outcome as a formal licence review. A decision to settle early should not be seen as a soft option. The Commission will set clear and challenging timetables for settlement discussions. Where timetables are not adhered to the Commission is likely to revert to a formal licence review.

Credit for timely disclosure

4.10 The earlier that disclosure of all relevant facts and appropriate admissions are made during the investigation process, the more credit will be given to the licensee for making such disclosure. This will be so whether the Commission has commenced a formal licence review or not. In certain appropriate cases in which the Commission is considering a financial penalty, and in which timely disclosure and admissions have been made by a licensee, the Commission will seek to give a discount to the penal aspect of a financial penalty for this in accordance with the Statement of Principles for Determining Financial Penalties.

Licence reviews and criminal convictions

4.11 The Commission will commence a review under section 116 of the Act where a relevant offence is committed by an operating or personal licence holder or a person relevant to any such licence, except in exceptional circumstances.

Criminal investigations

4.12 The Commission will focus on investigating offences under the Act, such as crimes in which gambling is an intrinsic element (for example, illegal gambling) and crimes which affect the outcome of gambling (for example, cheating where that affects other players), together with any other offences related to gambling (for example, money laundering offences under the Proceeds of Crime Act 2002 (opens in new tab) and illegal money lending). It will do so in conjunction with other bodies and/or other regulators as necessary.

4.13 In order to target resources where we can be most effective, investigating crimes against operators will normally be a low priority for the Commission, unless the alleged offence also affected consumers. In rare instances the Commission may investigate crimes against operators, but ordinarily such allegations will be matters for the police.

4.14 The Commission will not itself investigate offences which are not related to gambling, but will have regard to the outcome of investigations carried out by other bodies (for example, burglary of premises licensed under the Act or theft by staff) where they raise issues regarding the continuing suitability of licence holders. The Commission may also pass information about such offences to the police or another relevant prosecuting authority.

Considering the outcome of investigations carried out by other regulators/government agencies

4.15 The Commission expects operators to comply with the law, both in the UK and in other jurisdictions in which they, or related companies, operate. Failure to meet this expectation may raise questions about the continuing suitability of licence holders.

Publication of information relating to the Commission’s regulatory functions

4.16 The Commission will publish regular statistical updates on its regulatory work.

4.17 The Commission will not normally publish details of the information found or the conclusions reached while its investigations are ongoing. An exception may be made where there is speculation in the public domain and or where those involved have made public statements which need to be responded to in order to avoid misconceptions arising.

4.18 However, the Commission will normally publish details of all formal regulatory action taken under section 117 of the Act, which may include reference to conclusions reached during the course of an investigation in the form of a public statement. Such information will normally be published 14 days after a decision has been taken, whether or not the decision is the subject of an appeal. Publications will also normally accompany a regulatory settlement.

4.19 When investigating criminal matters, the Commission will generally consider making a public announcement when suspects are arrested, when search warrants are executed and when charges are laid. A public announcement may also be made at other stages of the investigation when this is considered appropriate and will normally be made at the conclusion of any trial.

4.20 The Commission may, upon request, review any compliance or enforcement-related notices that are published on the Commission's website in order to determine whether continued publication is appropriate, or whether publicity should be removed or amended.

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Statement of principles for licensing and regulation - Principles for licensing
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Statement of principles for licensing - Promoting the licensing objectives
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