UK Gambling Commission to slash fees for smaller operators

UK Gambling Commission to slash fees for smaller operators

Monday, July 11, 2016 Posted by Andy McCarron
New proposals for licensing fees will benefit small arcades, bingo halls and LBOs

The UK Gambling Commission is proposing a 10% drop in its charges as it looks to restructure its licensing fees.

The point of consumption licensing that was introduced at the end of 2014 means that the regulator is now operating with a surplus of funds so it has decided to change how it charges licencing fees with a large move to a GGY-based structure.

The Commission currently licenses around 3,000 operators, and fees for around 1,900 would be expected to reduce under the Commission’s proposals. However around 100 of the country’s biggest operators would receive fee increases in order to ensure that the Commission’s costs are recovered.

The new structure has been suggested in a consultation document launched last week by the Gambling Commission and the UK Government. The preferred new structure would see fees for over 900 smaller terrestrial betting, bingo and arcade operators to reduce, typically by between 9% and 15%; with much larger fee decreases of up to 50% for several operators where fee bands have been sub-divided into smaller bands.

Another sector which would see a drop is the remote operators, where the Commission believes there will be over 350 remote operators (smaller and medium-sized casino, bingo, and betting operators; including real event, virtual event, intermediary, pool and telephone betting) which would receive fee reductions of various magnitudes, between 2% and 35%.

There would also be fee decreases of up to 75% for the smallest remote real event betting and betting intermediary operators, as a result of fee bands being sub-divided into smaller bands and a greater proportion of regulatory costs being recovered from the largest remote betting operators.

Fees for around 20 of the largest operators would increase. Such fee increases would be between £18,000 and £67,000 (between 22% and 39%) for the largest non-remote operators, and between £26,000 and £164,000 (i.e. between 54% and 140%) for the largest remote operators.

Around 70 medium-sized terrestrial operators would experience fee increases. The new recommended fee levels for such operators would represent around 0.2% to 0.4% of their annual GGY (based on fees increasing by 100% from around £1,500 to £3,000). The operators subject to such an increase would be paying a fairer share of regulatory costs through their fees, given that they have relatively high gambling yields despite their small number of premises. A handful of medium-sized remote operators would also experience fee increases of around £8,500 (i.e. increases of 22%).

Totally Gaming Says: "The Gambling Commission's licensing fees have been a contentious issue since they were introduced in 2007, with many smaller gambling operators complaining that the cost of the (then) new regulator was being disproportionately met by them, while the bigger operators enjoyed huge economies of scale in the fee structure. The new system looks to rectify that though with the move to a GGY format - the problem is that many of the smaller operators have been squeezed out of the industry during this period. But those that have fought on will likely have a better chance for survival with a reduced regulatory cost."

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