The gambling industry has been warning the Gambling Commission of Great Britain (the GC) over the potential growth of the black market should the legal market become over regulated. Previously the GC downplayed the threat of the black market following PWC’s ‘Review of Unlicensed Online Gambling in the UK’ in February 2021 and EY’s ‘The Economic Contribution of the Betting and Gaming Sector: 2021-2022’ from November 2022.[1]However, Tim Miller’s speech at ICE 2023 recognised the threat posed to customer safety by the black market.
Not On GAMSTOP
In particular, the speech highlighted the GC’s focus on ‘not on GAMSTOP’ websites. In the UK, it is illegal to operate a gambling website without appropriate licences from the GC. It is a condition of every B2C licence that the operator is a member of GAMSTOP, the national gambling self-exclusion scheme. GAMSTOP allows consumers to register their details which then prevents them from using gambling services run by companies licensed in Great Britain. In flaunting their status as ‘not on GAMSTOP’, these unregulated operators can take advantage of vulnerable customers who have decided to exclude themselves from online gambling.
Although an operator may be unlicensed in Great Britain, however, they may be licensed in other jurisdictions. The UKGC has said it will increase co-operation with international partners in an attempt to disrupt this aspect of the black market in Great Britain.
GC’s Perspective
The GC’s recognition of the threat of the black market appears to be driven by its duty to protect the vulnerable, but they have yet to accept the calls from some in the industry that the ever-increasing expectation for operators to monitor and control customer activity (especially around so called ‘affordability checks’) could push customers to gamble with unlicensed operators.
Indeed the GC also warned the gambling industry that they did not view the threat of the black market to be a reason not to tighten regulation.
Other Topics in the Speech
Other topics in the speech included the innovation of the industry in the UK, consolidation of the market and rise in M&A and the increasing offering of gambling-adjacent products like NFTs, synthetic shares and some crypto currencies.
A version of the speech has been published on the GC website and can be accessed here.
[1] See, for example, Sarah Gardner’s speech to the Danish Gambling Authority dated 10 January 2023.
