Joint Committee on the Draft Gambling Bill Minutes of Evidence


Examination of Witnesses (Questions 1560 - 1579)

TUESDAY 24 FEBRUARY 2004

MR ANDREW BROWN, MR JIM ROTHWELL, MR CHRISTOPHER GRAHAM AND MR ROGER WISBEY

  Q1560  Mr Page: That means that somebody has got to complain in some capacity or other to the Commission. What you are obliquely saying is for that the responsibility should come back on the Gambling Commission?

  Mr Brown: Yes, I think that is right.

  Q1561  Mr Meale: Could I go back to the answer you gave to Richard Page. He mentioned that there is a difference between premises and web sites. A condition of the licence of a bookmaker, for instance, is that they should have terms and conditions pinned on their wall somewhere in their reception. Why is that not the case on the web site? Why it is there is not a page of terms and conditions? Why are you not enforcing that?

  Mr Graham: It is not for us to enforce that because our writ does not extend to corporate web sites; it is just not what we do. If we tried to do it we would not get anywhere. We have got nobody to play with, if you like. You have to have an intermediary. The system works as is it does because of the interplay of interests between advertisers agencies and the media. If something is being posted on the internet from another jurisdiction then there is not a lot that we can do about that and we are determined not to claim to regulate what we cannot regulate. So it may well be the Gambling Commission will want to set down rules for the way licensed services can conduct themselves on the Internet, but that is absolutely beyond what we can do or have any opinion on. What we can do is to regulate the advertising in the non-broadcast media that we can effectively control, and I think we do a pretty good job of that.

  Chairman: Lord Brooke?

  Q1562  Lord Brooke of Sutton Mandeville: I do not know whether Mr Wisbey wanted to say anything.

  Mr Wisbey: If I could just elaborate on something Andrew said earlier on. The Gambling Commission would issue the licence and the Gambling Commission could presumably monitor what goes on in the retail premises and on the web site and use the information gleaned from that to decide whether to reissue the licence or revoke it.

  Q1563  Jeff Ennis: You say they should do that on the licence but not monitor and use it in anything to do with advertising?

  Mr Wisbey: Yes.

  Q1564  Chairman: This presumably is part of your point, Mr Graham, that in effect in the end the Gambling Commission has the backstop power?

  Mr Graham: Yes.

  Q1565  Chairman: So the Gambling Commission has the backstop power both in terms of the regulation of the adverts but also the regulation of the premises and also any web site referring to the premises?

  Mr Graham: Because of the licence arrangements. The simple point, Chairman, we are trying to make is do not put under statutory control something which is currently effectively regulated by the self-regulatory system, and we are confident can go on being regulated effectively by the self-regulatory system. That does not mean to say that we are able to sort out all the problems of licensing and gambling. That is not our point at all. We are asking to be left to get on with what we can do effectively because from bitter experience we learn that very often statutory regulation is less effective and just because you have passed a law does not mean the sun is going to shine, particularly if you cannot devote the resources to implement it. Here you have got an effective system, leave us to do our thing; we can deliver a good result for you.

  Q1566  Chairman: For the benefit of the Committee and the witnesses, a little note has appeared for me confirming that Clause 94 permits the Gambling Commission to review the operation of any licence, which we knew but it is useful to have the reminder, which is really your point, Mr Brown, that that power gives the Commission a wide range of options in respect of any complaint which you, Mr Graham, in your organisation may adjudicate upon but which if the operator refuses to comply then the Commission can do something about it through the licence.

  Mr Brown: Yes, there is a real stick in the cupboard and presumably it can be used in a variety of ways—the licence can be permanently withdrawn or withdrawn for a limited period of time. Presumably within that sanction there are a great deal of other sanctions.

  Chairman: Fine. Lord Brooke?

  Q1567  Lord Brooke of Sutton Mandeville: It is quite possible that our witnesses will feel the question I am going to ask, which follows on from Mr Page, has already been answered in their answers to Mr Page, but in the interests of precision, should those gambling advertisements which originate from outside the UK, or indeed any such, because I realise some might excluded, be regulated?

  Mr Brown: Certainly within the European area they should be regulated, but at the moment they are being regulated on what we would call a "country of origin" basis under the Single Market, so that if an advertisement comes in from France, to make life simple, and it is seen by a British consumer who complains about it, they would complain to the ASA and the ASA through a body based in Brussels—the European Advertising Standards Alliance—would refer it to the French system for adjudication. Thus there is a way of managing cross-border activity within Europe, but there is not a way of managing it outside, and the Internet is very tricky, so I think the way that the industry is increasingly looking at the Internet is to think about safe areas within it to try and provide consumers with reassurance that where they are trading is actually an okay place to be. That is rather different from conventional media where you want to get rid of unsafe places, but in the Internet situation that is not going to possible.

  Q1568  Lord Brooke of Sutton Mandeville: Has Mr Graham any comments to make because it was his answer earlier that caused me to wonder whether the question had already been answered.

  Mr Graham: So far as cross border complaints are concerned, within the European Union there are two developments which may be relevant. The first is the European Advertising Standards Alliance, which is the self-regulatory clearing house, if you like, for cross border complaints, among other things, and it is very seized of the imminent expansion of the European Union and the need to have ASAs in the 10 enlargement countries. We have got four out of 10 at the moment and we have got to work on the other six in pretty short order.

  Q1569  Chairman: Would you like to identify who the four are?

  Mr Graham: Hungary, the Czech Republic, the Slovac Republic and Slovenia. We are working on Poland next because that is 50 per cent of the enlargement and we have got plans for road shows in the Baltics. We were in Athens last week urging the Greeks to sort out the Cypriots and so on. There is an awful lot of activity to make sure that self-regulation is effective across the Single Market because, quite honestly, the system is only as good as its weakest link, and it is no good the ASA doing its stuff in the UK if we cannot sort out for UK consumers mailings that are coming in from Austria or the Netherlands or whatever. There is a lot of work going on there. Perhaps the Committee can be reassured on that point. The second area is on the European Commission front. Committee members may be aware that there is a lot of effort going into an Enforcement Co-operation measure because our backstop is the Office of Fair Trading and the equivalents of our Office of Fair Trading are to different extents effective in different Member States, and the Commission is putting a lot of effort into making sure that there is an effective regulatory network that works right across the Single Market so that when we refer an advertiser that we cannot get any sense out of, the Office of Fair Trading has an effective partner to pursue it. The proposal in the policy note about the reserved power to prohibit the advertising of gambling from particular jurisdictions might not need to be called into play quite so soon as it otherwise would be if the enforcement regulations go through and the OFT can deal with similar organisations in different countries, so I think there are lots of different policy initiatives continuing. We are doing what we can in new media. I have talked about our Internet remit. We are also geared up to deal with text messaging. If you get a text message which you think is misleading or offensive you can refer it by text to the Advertising Standards Authority. We are well on top of on-line complaints. 45 per cent of complaints to the ASA last year came in via e-mail through our on-line complaints form. We are not some fuddy-duddy organisation that has not caught up with the real world. We are very seized of the fact that new media pose new challenges to regulators and we have got to be geared up.

  Q1570  Lord Brooke of Sutton Mandeville: I think that is one of the more reassuring answers we have received in all the period of these evidence-taking occasions. You have omitted Malta in what you have said. For historical reasons a lot of British might feel Malta was closer to us than any of the other nine countries.

  Mr Graham: We look forward to visiting Malta!

  Q1571  Lord Brooke of Sutton Mandeville: To go back to Mr Brown's remarks about safety, where or how would that be taken forward?

  Mr Brown: The safety of?

  Q1572  Lord Brooke of Sutton Mandeville: You were saying as far as the Internet was concerned there was an interest in concentrating on areas which were safe as against concentrating on areas which were unsafe?

  Mr Brown: I think where it is at the moment it is quite tricky because it has to be led by advertisers who want to boost levels of consumer confidence in what they are doing on the Net. The problem with national kite marks, which is the obvious route to go down, when a multi-national ends up on the "Formula One" principle covered in kite marks and they all in effect remove the common sense of each other. There have been some attempts. Within CAP we have tried to introduce a scheme to increase confidence called Admark but it has had very limited take-up. I think there are a lot of people looking at various areas to try and improve levels of consumer confidence, but I still do not think they have got anywhere near cracking the answer, so it is not as advanced as I would like it to be.

  Q1573  Lord Brooke of Sutton Mandeville: Finally and light-heartedly because it involves a source from outside the United Kingdom, what would you estimate Lord Lipsey's verdict would be on an advertisement that quoted one of the great Damon Runyon's characters to the effect that "the race is not always to the swiftest nor is the battle to the strongest, but that is the way to bet"!

  Mr Brown: I will pass that to the regulator, of course!

  Mr Graham: Well, it is dangerous to say almost anything about betting without first consulting Lord Lipsey himself.

  Chairman: We would vouch for that too. Lord Wade wanted to pursue this a little further.

  Lord Wade of Chorlton: We have already discussed the issue of advertising on the Net and so on but how great is the problem posed by SPAM e-mails and Internet pop-ups?

  Q1574  Chairman: Before you answer can I say it is a huge problem to Members of Parliament. I get about 400 SPAM e-mails every single day.

  Mr Graham: I think you should perhaps distinguish between pop-ups and SPAM. Pop-ups are a legitimate advertising medium. If they are annoying advertisers will use them less and less, and there is some evidence of that. SPAM is illegitimate. The latest edition of the Code was ahead of the game with the electronic marketing rules and the new provisions here made it very clear that people would expect to opt-in and not receive material which was not welcome. I do not know what it is like in the Palace Westminster but I heard in another Committee they were talking about the problem of SPAM. I do not know how good the fire walls are because Members of Parliament seem to be getting a lot more exciting e-mails than I get because we have a very effective fire wall.

  Q1575  Lord Wade of Chorlton: What action do you take? You say that in your code there is a restriction laid down for these issues, but what can you do if somebody complains to you about a particular SPAM or pop-up?

  Mr Graham: First of all, if it is simply a breach of a new rule about something coming uninvited then we can adjudicate on that. It might be that they thought the advertisement was misleading or offensive or socially irresponsible and then we would look at it under the appropriate section of the code. If we upheld the complaint we would publish that on our web site. We publish our adjudications each Wednesday morning and quite a number of them get a certain amount of coverage, particularly because there is a certain element of "name and shame" about it. The persistently misleading advertiser could be referred to the Office of Fair Trading for action under the Control of Misleading Advertisements Regulations. With pop-ups we can talk to the Internet service provider, and we get good co-operation there. If someone is spamming the world from a garage in Nevada there is not a lot I can do about it.

  Q1576  Lord Wade of Chorlton: Somebody who sends SPAM is not going to be worried too much about shaming anyway. He has already been sufficiently shamed to have thought it up in the first place.

  Mr Graham: That is why it is important for regulators to be clear about what they can or cannot do. The Gambling Commission is not in any different situation in dealing with the man in the shed in Nevada.

  Q1577  Lord Wade of Chorlton: Following on from that, who should bear responsibility for controlling the content of the gambling adverts, the platform provider or the operator?

  Mr Brown: The first source of responsibility is the advertiser, the operator. They are the person who is commissioning an advertisement, they are paying for it to be placed. I think there is quite an important bit in the policy note on providing for an offence for the media who carry advertisements that may be problematic, and I think that is right. You use the media as a policeman or as a gatekeeper to stop publication. That is quite different from making them responsible for the content. The content, in my view, has to be the responsibility of the operator who commissions it and the agency presumably has a responsibility because they are preparing the advertisement but they are preparing the advertisement to a brief provided by the operator so the operator, in my view, is the primary source of responsibility. That why if there is an independent adjudication against that operator and that operator refuses to amend their advertisements, and for some reason they continue to get them published, it seems to me they should be referred to the Gambling Commission.

  Chairman: Thank you. Can we move on to problem gambling?

  Q1578  Viscount Falkland: Your written evidence to us on gambling services advertising to children and young people leads me to ask you the question whether you really think it is fair and workable? Indeed, is it possible to prevent children receiving advertisements for gambling products?

  Mr Brown: You can minimise it and you can certainly ensure that the advertisements are not targeted at children and you can ensure that the content of an advertisement is not likely to have particular appeal to a child. You can do all those kinds of things. The reality is that you cannot cocoon children from commercial messages. For example, more children watch adult television than watch children's television designed for them. You cannot isolate children from commercial messages, they will see something. What you can do is ensure that the way that it is designed does not have particular appeal to them. I think you have content rules that make it less relevant and you have media rules that reduce the likelihood of exposure rather than maximising it.

  Q1579  Viscount Falkland: In your written evidence you suggested that young persons should be treated differently when it comes to whether or not they should be advertised to. Can you amplify that a bit more?


 
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