Memorandum from Granada Media Group Limited
(DGB 126)
1. This response is a joint submission by
ITV plc, GMTV, Channel 4 and Five in relation to the issue of
prize competitions and the possible impact in practice of Section
206 of the Draft Gambling Bill. We would also refer the Joint
Committee to previous submissions of ITV, GMTV and Five to the
Department for Culture Media and Sport in regard to the issue
of prize competitions.
2. To summarise the present industry practice
of prize competitions in programmes:
— Prize competitions are a long standing
and integral editorial feature of a number of television programmes.
— They operate within effective regulatory
frameworks (Ofcom, ICSTIS).
— They generally offer a relatively
low cost of entry (often between 25p-60p, and rarely exceeding
£1).
— They require the exercise of some
skill, often in the form of a multiple choice question upon entry;
sometimes further exercise of skill is required via on-screen
participation by finalists.
— They are widely accepted as a commonplace
and popular addition to the programmes in which they feature (eg
entertainment, daytime, children's), encouraging viewer interaction
and participation and enhancing viewer enjoyment.
— Entry mechanisms, costs and description
of prizes are transparent to viewers.
— There is no persuasive evidence that
prize competitions compete with "good cause" non-commercial
lotteries, or have given rise to problems of addictive behaviour.
— They provide a significant revenue
stream that can be returned to programme production for the benefit
of viewers.
— They have never attracted any significant
level of complaint from viewers or become a matter of concern
to the broadcasting or telephone regulators.
3. We welcome the current legislative effort
to clarify and modernise the law relating to gambling and lotteries.
We support the Government's view that prize competitions are not
a form of gambling, and that the current distinctions between
lotteries and prize competitions are confusing and ambiguous.
We have previously argued that change in the law should serve
to draw a clear distinction between prize competitions as they
commonly operate on television, and lotteries. Whilst the proposed
drafting in Section 206 goes some way towards drawing this distinction,
we believe there is some cause for concern that the drafting still
offers scope for confusion between the two.
4. Section 206 defines a lottery as an arrangement
whereby—
(a) one or more prizes are allocated
to one or more members of a class (or to each member of the class);
(b) the system for determining the allocation
of prizes relies wholly on chance; and
(c) individuals are required to pay in
order to enter the lottery.
Section 206 (4) goes on to state that—".
. .a system for the allocation of prizes relies wholly on chance
despite the fact that persons are required to exercise skill in
order to enter the lottery, if the requirement is not likely to
prevent persons who want to enter the lottery from doing so".
5. We welcome the limitation on the definition
of a lottery to those arrangements relying "wholly on
chance", derived from Lord Widgery's formulation in the
Reader's Digest case. This would resolve some of the ambiguities
of the existing law which makes unlawful any "competition
in which success does not depend to a substantial degree on the
exercise of skill" (Section 14 (1) Lotteries and Amusements
Act 1976). We also support the stated object of this part of the
Bill, as discussed in Chapter 8 of the Regulatory Impact Assessment,
namely to clarify the definition of a lottery, and to provide
that "a scheme in which a degree of skill or knowledge is
needed in order to secure a prize will not be capable of being
a lottery" (paragraph 8.18). In the past determining whether
the degree of skill or knowledge required is "substantial"
has never been straightforward. Assessments of the "difficulty"
of questions are necessarily subjective. As we have suggested
previously, what for example constitutes an easy question for
a teenager may be particularly challenging for a pensioner, and
vice versa.
6. We therefore do not believe the new definition
requires the intended clarification of "wholly by chance"
in the proviso suggested in Section 206(4). We do not believe
this proviso addresses any particular mischief and is rather an
opening for further confusion. If it is intended to outlaw competitions
that are too "easy" (ie such that there is effectively
no exercise of any skill at all, and therefore the competition
is a de facto lottery), then the "wholly by chance"
definition already provides sufficient clarity in this regard.
A competition requiring no skill at all would be caught by Section
206 (1)(b) already. But the further proviso would reintroduce
uncertainty, as it then requires that the competition promoter
must judge or somehow establish whether or not an entry question
is sufficiently challenging that it would "prevent persons
who want to enter . . . from doing so".
7. The Explanatory Notes to the Bill state that
"It is intended that where a person must exercise skill of
some description to enter the class, if the skill required is
of a kind which is unlikely to serve as a barrier to entry for
any person who wishes to enter it, this will not prevent the allocation
of prizes from being regarded as wholly by chance, and therefore
will not prevent the scheme from being a lottery". We believe
this suggestion is unrealistic. Television prize competitions
are by their very nature intended to encourage rather than discourage
participation, within the confines of the requirement of an exercise
of skill. Many questions would be straightforward for one sector
of the population (whether in terms of age, geography or ethnicity)
but not another, eg "name the guitarist in the band the White
Stripes" would be straightforward for many young viewers,
but might be challenging for older viewers. Our experience is
that there is always a proportion of wrong answer entries to television
competitions. We would argue this merely demonstrates that there
is indeed a requirement of skill in answering the question correctly.
Yet the proposed definition could be construed to suggest that
unless some potential entrants are actively prevented from entering
by the degree of skill required, the competition might be deemed
an unlawful lottery. This in turn might be deemed to require far
more arcane and difficult questions than are routinely employed
in television competitions at present, and which would not engage
or interest viewers. This would serve the interests of no one,
and would rather work against the interests of the millions of
viewers who currently enjoy participating in such competitions.
We believe the primary definition "wholly by chance"
is sufficient and clear, and will serve to ensure that the current
industry practice in television prize competitions remains within
the new statutory framework.
8. We would therefore urge the Committee
to recommend the omission of Section 206(4). We would ask for
further consideration to be given to whether formal and explicit
recognition in the Bill of the clear distinction between television
prize competitions and lotteries is desirable. We see no pressing
social or economic needs, and no public support whatever, for
any legislative measure that might equate such prize competitions
to lotteries, or that might render such competitions unlawful.
February 2004
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