After promising reforms back in December 2020, the British government’s gambling regulatory body revealed the proposed reforms in April 2023. The reforms were proposed to ensure that the Gambling Act 2005 is relevant to the digital age of gambling. The announcement came out as the Gambling Act Review White Paper in the House of Commons.
The UK has a rich history of gambling, especially at the horse racing tracks. You can still find active physical shops spread all over the UK. It was also relatively early in regulating online gambling. It started with the enactment of the Gambling Act 2005, followed by the formation of the UK Gambling Commission.
The reform proposals also focus heavily on player safety at UK online casinos as per agamble.com. The proposals came in the middle of the increasing number of problem gambling cases. Here is a quick overview of the reform proposals:
- Statutory Gambling Levy: With no mandate for funding for problem gambling treatment and research, betting firms in the UK have paid as little as £1 to the cause. The reform includes a mandatory levy on operators.
- Stake Limits: Online casinos may have to limit the stake size between £2 and £15. An even lower limit for players between 18 and 24 is proposed. If the proposal is accepted, young gamblers will not be able to spend over £4 per spin.
- Player Protection: Gambling operators will need to perform further investigation if player losses exceed a predetermined amount.
- More Power to UKGC: The reform will allow more power to the UKGC for tackling black market gambling operators.
- Bonus Overview: How bonuses like free bets are presented to gamblers will change with the new legislation.
Since the talks of new mandates came into the player, the UK’s online gambling scene has been somewhat declining. One of the world’s top credit rating agencies, Fitch Ratings, has recently affirmed 888 Holdings PLC at BB.
By definition, the BB ratings entail “an elevated vulnerability to default risk, particularly in the event of adverse changes in business or economic conditions over time.”
888 Holdings PLC owns 888Casino, 888Sport, 888Poker, William Hill, SI Sportsbook, and Mr. Green Casino. Despite a heavy international presence, the UK has always been the core market for the 888 brand. It’s the overhaul of the existing gambling legislation that negatively impacted the Issuer Default Rating (IDR) for the company.
Once the proposed reforms are reviewed and enacted, it could make the situation even worse. However, if the outcomes of the legislation are better than expected, the IDR rating may improve.
In July 2023, the UK government declined a lawmaker proposal to regulate cryptocurrencies as a component. The proposal was submitted in May when the majority of Europe was embracing Markets in Crypto-Assets (MiCA) Regulations.
Britain’s Financial Services Minister Andrew Griffith said, “Treating crypto-assets as a form of gambling would put Britain at odds with global and European Union regulators and fail to mitigate the risks from the sector.”
The original report submitted by the Treasury Select Committee stated that “Bitcoin, Ether, and other unbacked cryptocurrencies should be regulated as gambling given the significant risks they pose to consumers.”
The decline from the policymakers was expected in such a turbulent time for the UK’s gambling landscape. Cryptocurrencies are already a critical paradigm to deal with, and combining it with gambling could be catastrophic for the country’s economy.
With the UK’s general election roughly scheduled for 2024, it’s a critical time for the party in power. The actual timeline of when the new reforms go live will depend on the priorities set by parliament. New legislation on a £14.3 billion industry can turn out to be the maker or breaker of general election campaigns.