Gambling (Licensing and Advertising) Bill

Written evidence submitted by Sports Betting Group (GB 05)

Introduction

1. This evidence comprises the views of many of the sporting bodies and organisations (the "Sports") who work together as the Sports Betting Group (the "SBG").

2. The SBG is made up of representatives from the Football Association, England and Wales Cricket Board, British Horseracing Authority, Rugby Football Union, Professional Players Federation, Premier League and Sport and Recreation Alliance.

3. The SBG was formed in 2010 following the publication of the Report of the Sports Betting Integrity Panel [1] commissioned by the Department for Culture, Media and Sport. The Sports Betting Integrity Panel was chaired by Rick Parry and its findings contained a number of recommendations for each of Government, Sport, the Betting Industry and the Gambling Commission to take forward to improve sport's protection against betting integrity breaches.

4. The SBG also provided oral evidence to the DCMS Select Committee during its pre-legislative scrutiny of the Bill.

Summary – Supporting, and Improving, the Bill

· The SBG welcomes the Gambling (Licensing & Advertising) Bill and has consistently campaigned for the principle that all overseas operators taking bets in the UK should be fully licensed by the Gambling Commission.

· It is vital for the integrity of sport that all operators adhere to Licence Condition 15.1 on sharing information and reporting suspicious betting activity on sporting events.

· We are concerned that these arrangements do not apply to spread betting companies and would like to see either the Financial Conduct Agency (which regulates spread betting) introduce Licence Condition 15.1, or the Bill be amended so that spread betting is covered by the Gambling Commission’s Advertising and Licensing arrangements.

· We are also concerned at the effectiveness of the current structures to deal with those who cheat at sport. The SBG believes that the Bill should also introduce a new legal definition for cheating at sport/match-fixing since the current provisions in the Gambling Act 2005 are not fit for purpose. This follows recommendations made by the DCMS Parry Report into Sports Integrity [2] and by a recent European Parliament Report [3]

Additional information

Upholding integrity and Licence Condition 15.1

5. Promoting and upholding integrity is one of the key functions of all sports governing bodies and event organisers. The whole concept of sport is based on a fair competition between participants under agreed rules. It is a vital principle for any sport that all involved are genuinely competing to win, and are seen to be doing so.

6. Those who seek to influence the outcome or progress of sports events to secure rewards through betting undermine this principle. Any suspicion that this is happening can be deeply damaging.

7. The growth of betting services means that sports must remain constantly vigilant of the increased opportunities which could potentially be exploited by corrupters. There are many examples of both historical and recent occurrences where people have tried to corrupt sport for financial gain through betting. Sports governing bodies, the Government and the Gambling Commission must remain alert to these dangers, and treat corruption connected with betting with the same rigorous action as that taken to ensure sports remain free from doping.

8. Recent years have seen a huge increase in sports betting and a proliferation of the number of different types of bets that can be placed on sporting events. This has been fuelled by the internet, new media and the popularity of in-game betting. At the same time, the last Government introduced a new licensing regime in 2005 that gave greater freedoms to betting companies in terms of how they are able to operate and market their products. This has resulted in a large number of on-line operators based overseas offering services to British consumers.

9. SBG members campaigned for the introduction of Gambling Commission Licence Condition 15 that makes information sharing between betting operators and sports governing bodies a statutory requirement. It has made a noticeable difference in the ability of sports to secure important information. Licence Condition 15 also places a duty on operators to report suspected breaches of integrity.

10. Measures to maintain integrity in sport will only be effective if they apply to all betting companies operating and/or advertising into the UK (taking bets from British punters on sporting events).

11. There is clearly little logic in having a UK regime operated by the Gambling Commission that certain operators can choose to avoid by locating overseas. Indeed, in 2009 both William Hill and Ladbrokes moved their online betting operations offshore to Gibraltar and most other major betting companies have followed suit including Betfair. Not only does this effectively make Licence Condition 15 redundant, but other important protections such as the right to void a bet are undermined.  

12. The Sports therefore strongly endorse and fully support the Government’s proposal to bring forward new legislation for regulatory arrangements that will require all gambling operators to obtain a licence to transact with British consumers and advertise in the UK.

Spread Betting

13. One area where the SBG feels that the Bill could be strengthened is in relation to the regulation of spread betting. Whilst the Government should be commended for its efforts to ensure that all fixed odds betting operators offering bets in the UK comply with Licence Condition 15.1 on information sharing, the same is unfortunately not true for spread betting companies.

14. Spread betting companies are regulated by the FCA rather than the Gambling Commission and as a result are not required to share information on suspicious betting patterns in the same way that fixed-odds operators are via Licence Condition 15.1. While the two companies currently offering spread betting on sport in the UK have voluntary information sharing agreements in place with the FCA, the SBG feels that these should be replaced with robust, statutory arrangements.

15. This view is backed up by evidence provided by Jenny Williams from the Gambling Commission during the pre-legislative scrutiny stage of the Bill. Taking the example of the fixed odds betting operators, she said that the Gambling Commission received one or two reports a month from its online gambling licensees, who handled less than 20% of the market, but from the 80% licensed overseas (which had voluntary agreements in place) the Commission had received a total of about ten since 2007. Ms Williams suggested it was implausible that so few suspicious transactions had been reported.

16. The Sports Betting Group is dissatisfied that despite raising this issue with the FCA for many years, it has not received any satisfactory answer as to how it intends to address the regulatory shortcoming.

17. This anomaly should be rectified as soon as possible and tabling an amendment to this Bill would be a way of achieving this. We have been in dialogue with the FCA and GC for over a year and we have been assured that the matter is being looked into but we are still to see any substantive progress. An amendment to the Bill would expedite this process and bring spread betting companies into line with traditional operators. This would be a major boost to sports integrity and the fight against betting related corruption in sport.

Legal definition of match-fixing

18. At present the UK has no specific laws to deal with the offence of cheating or match fixing in sport. The need for specific legislation has recently been stated by the European Parliament in its Action Plan on o rganised crime, corruption, and money laundering . The report recommends that Members States should:

‘make sports-rigging a criminal offence in order to strengthen the fight against illegal sports betting’ [4]

19. In 2010, the DCMS commissioned an Independent Report into Sports Integrity, led by Rick Parry. One of the recommendations of this report highlighted the need to review the definition of cheating as set out in the Gambling Act 2005. The recommendation said:

"Recommendations for government "

1.1 That the definition of cheating in the Gambling Act 2005 (the Act) be reviewed

and, if appropriate, given greater clarity. [5]

20. As time has passed the need for a review of this type to be undertaken has become even more pressing. We continue to see an inconsistent approach to investigations across enforcement agencies and limited application of the offence of cheating by prosecutors.

21. The SBG would like to see the Government review the offence of cheating as set out in the 2005 Gambling Act. An improved definition should be introduced that focuses on cheating in the sporting event, as well as betting, thus introducing a broader criminal offence of cheating in sport. This has already been done in a number of other countries including Australia [6] and Switzerland and was also recommended in a recent European Parliament anti-corruption Action Plan.

 November 2013