Affiliates should be wary of further closures

Affiliates should be wary of further closures

Monday, September 11, 2017 Posted by Andy McCarron
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Operators been 'ignoring' affiliate marketing liability risks

Sky Betting & Gaming's recent decision to close down its affiliate programme should not be viewed as a major shock according to Dr. Joerg Hofmann of German legal firm Melchers Rechtsanwaelte.

Last week saw the major British operator shut down its affiliate hub with 28 days notice to its partners citing regulatory concerns and Hofmann  believes that more could be on the cards if operators are to be more thorough,

He told “The industry has been ignoring liability risks arising in the context of affiliate marketing for too long and will have to wake up. They will be well advised to take a close look at their partners and policies in place to avoid risks to their company."

As a member of International Masters of Gaming Law, Hoffman has long been warning about liability and where it stops for the operator, which tends to be further than the operators themselves realise.

Sky Betting & Gaming suggested such concerns when it informed its affiliate partners of the closure. It said: “As you will be aware, the regulatory landscape in which the industry operates is developing and maturing and operators are experiencing increased obligations regarding their regulatory responsibilities and level of compliance.

“In order to continue to operate in a compliant manner, we feel that operating the Programme is no longer viable and that managing the output of affiliates presents a significant risk to our business from a regulatory perspective. It is for this reason that we have chosen to terminate the Programme.”

David Clifton of UK legal consultancy Clifton Davies explained last week: “This seems to me an unfortunate but inevitable consequence of the principle behind the combined regulatory requirements of data protection legislation, advertising rules and Gambling Commission LCCP demands, namely that gambling operators must take responsibility for the misdemeanours of their affiliates.

“Sky B&G appears to have decided that managing the compliance risks posed by its affiliates is too challenging a task and, with regulators adopting increasingly tough enforcement stances, one can’t help but wonder how many other operators will reach the same view.”

Totally Gaming says: The affiliate industry is on a tipping point - if another major operator follows suit and closes its affiliate programme then there is a danger the model is changed forever. However other operators may be more reliant on third party affiliate traffic than Sky Betting & Gaming, given that it owns major affiliate, and so have fewer compelling reasons to repeat the move.


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