EFL Reacts to Gambling Sponsorship Proposals

The English Football League (EFL) has reacted to proposals that would ban sponsorship deals with gambling bans, by expressing their opposition.

The UK government is considering the findings of a report by a House of Lords committee, recently published, which had been set up to examine the impact, both social and economic, of the gambling sector. The report recommended that the government bring in a ban on betting companies sponsoring sports teams as part of a series of measures aimed at tackling gambling-related harm.

The EFL, which includes football clubs in the Championship, League One and League Two, fears that many of its clubs could be financially vulnerable to such a measure, given how many of them rely on sponsorship deals with gambling brands. The Football League itself has a naming rights deal with SkyBet, which is set to run until 2024, while 17 out of the 24 clubs in the Championship also have shirt sponsorship deals with betting companies.

In a statement responding to the report, the EFL focused on the fact that many of its clubs were financially vulnerable, due to the Covid-19 pandemic and associated shut down, which led to the early conclusion of League One and League Two. The EFL pointed out that betting companies fund EFL clubs to the tune of more than £40 million every season, underlining what the EFL described as the significant contribution that betting companies make to the financial sustainability of professional football, which they say is as important now as it has ever been.

Although the committee’s report recommended an end to gambling advertising, they also stated that such restrictions should not take effect for clubs outside the Premier League until 2023. Nevertheless, it concluded that gambling advertising in or near sports grounds or venues should be ended.

The review by the House of Lords followed on from the commitment made by the government to review the 2005 Gambling Act, and at a time when many have been criticising the industry.

In its statement, the EFL added that it was happy to collaborate with the government on gambling reduction, but reiterated its overall operation to widespread gambling advertising bans:

“The League firmly believes a collaborative, evidence-based approach to preventing gambling harms that is also sympathetic to the economic needs of sport will be of much greater benefit than the blunt instrument of blanket bans. It is our belief that sports organisations can work with government and the gambling industry to ensure partnerships are activated in a responsible fashion.”

Switzerland Acting on Overseas Gambling Operators

The Swiss Lottery and Betting Board (Comlot) officially blocked 88 domains run by foreign online gaming operators during 2019, according to its annual report, published on Monday.

Last year was the first in which blocks on foreign operators had been implemented following a change in the law. In June 2018 a majority of Swiss voters approved the reform of the country’s gambling law despite protests by opponents who warned of government censorship. The law came into effect in January last year, although enforcement action against foreign sites didn’t start until August.

Swiss gamblers are able to bet online only with Swiss casinos and with lotteries that pay tax in Switzerland. Registered sites also have to demonstrate that they take sufficient measures to protect people from gambling addiction. Other sites are automatically blocked by all Swiss telecommunications service providers through domain name server blocks.

The report from Comlot shows that the law had already started to have an effect before it came into force. A number of major players in the international sports betting market had made contact with the board at an early stage and had withdrawn from the Swiss market. But according to Comlot, some providers had tried to mitigate the effects of the access block by repeatedly adding new domains.

Comlot pointed out that this demonstrated the determination of foreign gambling operators to break the rules. They also said that it indicated the technical blocking measure was effective.

In its report Comlot also published gambling statistics for 2019. These showed that automated and online lotteries, along with sports betting had generated a turnover of $3.17 billion during the year. Around 83% of this figure was accounted for by the lotteries, mostly the EuroMillions and Swiss Lotto. Each of Switzerland’s 8.6 million residents gambled an average of $370 last year, while per capita winnings came to $248, which means each person lost $122 on average.

Kenyan Betting Tax Repealed

The National Assembly of Kenya has passed a bill that effectively ends the excise tax on betting stakes, the same tax that led to operators Sportpesa and Betin pulling out of the country.

The 20% excise tax on bets, introduced in the 2019/20 budget, was initially due to be carried over in the 2020/21 finance bill, but an amendment put forward by the country’s Finance and National Planning Committee has now led to its removal.

According to those proposing the reform, the excise tax had hit the finances of betting companies, leaving them with little money to support sports clubs. The Committee also heard that the tax had led many Kenyan betting customers to switch to foreign-based sites.

In the ensuing National Assembly debate, Joseph Kirui Limo, who chairs the Finance Committee said that tax revenue from the betting industry was going down, and that repeal of the tax would lead to an increase in revenue. A further proposal, to reduce the tax on winnings from 20% to 10% was rejected.

The original implementation of the excise tax on stakes, which was passed by Kenyan MPs in September 2019, had a significant effect on Kenya’s betting market. Local brand SportPesa said that it would pull out of the market, and another operator, Betin, followed suit.

The tax was also another step the ongoing dispute between Sportpesa and Kenyan authorities relating to tax payments. Back in August last year, the firm cancelled all sports sponsorship deals in the country following a ruling that telecoms companies were to block payments to Sportpesa over a tax revenue dispute. At the time, the firm said it was planning legal action against the regulators, the Betting Control and Licensing Board and the Kenyan Revenue Authority.

The ruling was reversed in November last year, a decision that Sportpesa said they welcomed, but although they said they may reconsider their withdrawal from the market, they have not yet returned. They have also declined to comment on the new reforms.

The bill is now set to go to Kenyan President Uhuru Kenyatta, who has the choice to sign it into law or send it back to the Assembly for further changes. The President has previously spoken out against the gambling industry, so it remains to be seen if he signs the bill. In fact, last year, Kenyatta called on the Assembly to pass a complete ban on gambling.

Gambling Boosts Malta Economy

The gaming industry in Malta made a contribution of €1.56 billion to the country’s economy in 2019, a rise of 9.6% on 2018, according to figures released by the Malta Gaming Authority (MGA) in their latest annual report. The report also showed that the MGA has drastically increased enforcement action, cancelling a total of 14 licences during 2019. The number of companies operating in the Malta sector increased by 3.9% to 294 although was still below 2017 levels.

The €1.56 billion figure was calculated by deducting the total value of goods and services consumed from those produced. It makes gaming the third-largest contributor from the private sector to Malta’s economy. In its report, the MGA also emphasised the contribution that the sector makes through linking to other industries including financial and ICT sectors, hospitality and catering, real estate, distributive trades and professional services. In total, the gaming industry accounted for 7,417 jobs during 2019, a rise of 9.2% year-on-year, with 6,593 of these jobs in the online gaming industry.

Casino games produced 56.0% of revenue, rising from 55.4% in 2018. Of these, slots were the most popular, bringing in 74.4% of casino gaming revenue, with table games accounting for 21.5%. Sports betting was the second highest contributor, with 36.3% of revenue, with over three quarters of that amount coming from football betting. Skill games, including the use of betting exchanges and poker, produced 7.7% of revenue overall.

The increase in cancellations from 8 in 2018 to 14 in 2019 reflected a significant shift in the MGA’s focus, along with another 11 suspended licences. In their statement, Heathcliff Faruggia, the Chief Executive at the MGA, emphasised the importance of the change:

“In 2019, a great focus was placed on ensuring that the Authority’s governance and structure reflected the increased focus on compliance and enforcement. More resources were given to compliance, with the scope of implementing the risk-based approach towards regulation more effectively.”

In total, the MGA issued 53 new gaming licences, out of 89 applications. This figure was significantly lower than the 93 licences given out in 2018, but the MGA said that this was largely down to a change to its licensing system. From August 2018, operators who already had a gaming licence no longer needed a new application if they wished to provide products in a different class.

Looking to the future, the MGA also announced that it had conducted a survey of licensees in April, in order to assess the impact of the Covid-19 pandemic on the gaming industry. Based on the findings, they forecast that gaming revenue is likely to drop by 12% in 2020, due mainly to a dramatic drop in sports betting revenue as a result of the Europe-wide cancellation of sports.

NHS Warning on Football Gambling

A senior figure in the National Health Service has warned of the risk of an increase in problem gambling associated with the return of Premier League football this week.

Claire Murdoch, the Director of mental health at NHS England has warned betting operators not to take advantage of the return of televised football with promotional campaigns that could cause more problem gambling, at a time when health service resources are stretched due to the global pandemic.

Murdoch, who has headed up the establishment of 14 specialist clinics across the country to treat those suffering from gambling addiction, said that the NHS service could struggle to cope with what she described as the ‘avoidable harm’ produced by gambling advertising. And she said that the aggressive marketing of gambling companies was causing widespread problems:

“The NHS is stepping up to the plate to offer specialist treatment, but with my colleagues having spent this year focused on protecting people from a once-in-a-generation global pandemic, the last thing NHS staff and patients need is for avoidable harm to be caused by reckless advertising and behaviour from the gambling industry as normal life begins to resume.”

Murdoch emphasised the risks of betting companies restarting their aggressive advertising campaigns to make up for the losses they have incurred with the suspension of live sport in the pandemic.

The industry itself, faced with an imminent government review of the 2005 Gambling Act, has brought forward a number of measures, many focused on the changed betting landscape shaped by the coronavirus lockdown. And in his response to Murdoch’s comments, the Chief Executive of the Betting and Gaming Council, Michael Dugher focused on the range of measures that the industry has introduced, including the ban on advertising during live sports television broadcasting. He also stated that at least a fifth of TV and radio advertising by gambling operators will be dedicated to promoting safer gambling, while the sector was setting aside £100 million for research and treatment.

But Murdoch says that she is concerned that the whistle-to-whistle television advertising ban is not matched by a similar ban on online promotions, particularly on mobile phone apps, which are used by many gamblers to bet in-play. Back in January, she wrote to a number of major gambling companies including William Hill and Bet365 criticising them over their marketing practices and underlining that there was a clear and worrying connection between gambling and mental illness.

EGBA Launches New Customer Protection Rules

European betting company customers are set to receive a new level of protection with the news that the region’s leading industry body has launched new rules for its members.

The European Gaming and Betting Association (EGBA) has released a new Code of Conduct that governs how online gambling firms should approach data protection, further strengthening their commitment to upholding the European Union’s GDPR regulations.

The code of conduct, which will be adhered to by all EGBA members, will detail a number of data protection measures that operators should take to ensure that the industry continues to enforce a high level of compliance with the best data protection practices. Individual compliance with the code is set to be monitored by a third-party organisation and will focus on a number of areas.

These include enhancing what are known as ‘portability rights’ which enable customers to move their personal data from company to company in a quicker and more secure way. This includes rules related to player account registration and marketing preferences.

Operators will also have to commit to supporting transparency. This includes adhering to a set list of details that need to be included in a privacy policy, and those areas that can be excluded. Operators will be obligated to bring in plans that will prevent breaches of personal data, and to ensure that their method of setting up VIP accounts respects the privacy and personal data of the customers.

In addition, gambling operators will be given clear guidance on how to balance the need to protect a customer from problem gambling, with the requirement to protect their privacy, including guidance on the issues of direct marketing and respecting self exclusion. New measures will also be suggested in the area of fraud prevention to offer more protection for customers.

Speaking about the rules, the Secretary General of EGBA, Maarten Haijer, said that they were pleased to be able to bring forward a new code, demonstrating the commitment of the industry to protecting customer data, on the two year anniversary of the successful launch of GDPR:

“We’re pleased to be one of Europe’s first industry sectors to introduce a self-regulatory code which supports compliance with GDPR. Data, and how it is used, is playing an increasingly important role in how citizens and businesses interact online, and the online gambling sector is no different.”

Haijer added that the code would set out clear rules on how online gambling companies should make sure that their customers know how their personal data is being used. He said that it also offers clear guidance for operators on how to use that personal data in all of their customer interactions, with particular focus on the issue of problem gambling behaviour.

Punters Welcome Return of Racing

Sports punters in the UK were celebrating on Monday as horse racing returned following a two month hiatus during the coronavirus lockdown.

The British Horseracing Authority (BHA) announced last week that racing was set to return, under strict conditions, and the first fixture at Newcastle on Monday proved to be a hit with punters. Many bookmaking firms recorded a significant boost in takings as racing fans had their first bets on English racing for several weeks, although the course itself was closed to spectators.

A range of betting companies said that there was a significant upturn on the usual Monday turnover. According to a spokesperson for Ladbrokes, turnover levels increased significantly. Those findings were echoed by leading betting exchange Betfair, which reported matched betting volumes of around £1 million per race, which was a significant increase on the normal level for comparable races.

Pat Cooney, of Bet365, also highlighted the benefits of 72 hours declarations and the absence of non-runners among the 120 horses entered on the card:

“It was helped by the fact that, at the time of the first race, we had 120 runners and no non-runners. With 72-hour decs, and then the sport getting the go-ahead, punters have had a long, leisurely look and we were very pleased with the levels of business. It’s certainly not a forgotten product.”

Live sport has largely been absent from the television screens of UK sports fans for the last two months, although there was been an increase in French racing in recent weeks, and Monday’s action included two well-supported races at Deauville.

The BHA has announced a provisional schedule to make up for some of the events that were lost during the last two months, which includes the peak of the Classic season, including the build up to the 2000 Guineas and the Epsom Derby. The schedule remains subject to government advice, and strict social distancing and other measures have been imposed for the foreseeable future.

British Racing Plots Return

The British Horseracing Authority (BHA) has set out of the details of a provisional fixture schedule for June, July and August as racecourses plan to resume activity from the start of June.

The governing body for racing in Britain, has also published its list of technical guidelines for all participants and staff to enable racing to resume behind closed doors this summer.

According to the plan, racing will take place in England from 1 June in conformity with the UK Government’s provisional timetable which will see the return of sport behind closed doors. Racing had initially been suspended on 18 March after plans for closed doors meetings were abandoned.

In total, 292 scheduled meetings are set to be held in the three months up to the end of August with the first at Newcastle on 1-2 June and Kempton Park also featuring on June 2. Many of the season’s big fixtures, including Glorious Goodwood and the popular York Ebor meetings, are unchanged from the original schedule. It has also been announced that 72-hour declarations will apply to all races.

The BHA have said that fixtures in Scotland and Wales have only been provisionally scheduled, and will be confirmed only after further consultation with the regional governments on timescales.

Resumption will also be conditional upon the government agreeing to the easing of restrictions as part of step two in the UK coronavirus recovery strategy. This stage includes the return of professional sport and a range of other cultural events, and the BHA explained that government guidelines demand that participants take extensive actions before the resumption.

The guidelines set out by the BHA include a list of individuals permitted to attend meetings as well as extra rules on screening, protective equipment and social distancing. They have been drawn up with the help of officials from Public Health England and a range of chief medical officers. They were drawn together with the guidance of BHA Chief Medical Advisor, Dr Jerry Hill.

In their announcement, the BHA said they were working to the government guidance on the return of elite sports published thus far and will be flexible if the guidance changes. Speaking about the resumption, the Chief Regulatory Officer at the BHA, Brant Dunshea, said that racing had been able to draw on considerable experience of combating bio-threats:

“Our trainers, jockeys and staff carry out their roles in a highly disciplined way because working with horses always carries risks. I am very confident they will adapt quickly to this new set of measures designed to protect them from transmission of the virus.”

UK Gambling Commission Criticised by Industry

The UK Gambling Commission (UKGC) is under fire again, this time from law firm Mishcon de Reya, over changes made to its responsible gambling measures, in light of the coronavirus pandemic.

The lawyers said that new provisions set out by the commission presented operational challenges to the companies asked to introduce them, and that the process was carried through in contravention of licensing rules that say such alterations should only be introduced after consultation.

According to the lawyers, the new fresh guidance should be taken into account and shouldn’t be mandatory for gambling operators, but they expressed concerns that the UKGC is likely to regard these changes as requirements when it comes to enforcement.

The UKGC changes include demands that operators review their thresholds and triggers that they use to track the vulnerability of their customers, in order to make sure that they are reflecting the changed circumstances of many consumers going through the current lockdown. The changes require a reset for early warning signs in the areas of increasing time or money spent on gaming.

The commission has also asked for procedures to be put into place to continually monitor the gambling companies’ customer base, with the purpose of identifying customers whose patterns of play, spend or behaviours have changed in recent weeks. Alongside these measures, operators are being asked to apply affordability assessments, limiting further play until these are complete.

Speaking about the changes, the law firm said that many in the industry would regard this as another example of the regulator applying stringent rules in the absence of any evidence to suggest that there was a significant increase in problem gambling. However, they also stressed that it was important for individual firms to comply in the short term:

“For the time being, licensees should take steps to implement the new measures. In the current political climate and in the interests of potentially vulnerable consumers, the industry needs to continue to act responsibly and be seen to be doing so.”

Lockdown Criticism for Australian Gambling Companies

Online gambling operators are behaving greedily during the ongoing coronavirus pandemic, according to a leading anti-gambling organisation.

Consumer data has shown that Australians have increased the amount of time they are spending using online gambling sites and one campaign group, the Alliance for Gambling Reform, have criticised the trend, calling on the government to bring in an online gambling advertising ban.

Speaking about the problem, Tim Costello of the Alliance, said that the advertising was targeting particularly young men who were bored, and pointed out that the UK sports betting industry had made a voluntary agreement not to advertise during the lockdown.

According to figures produced by analysts AlphaBeta and Illion, online gambling in Australia rose by almost 150% between April 26 and May 3. At the same time, consumer spending in general had risen 13% although it was still 7% lower than the pre-pandemic level. That boost in spending was believed to have been down to the one-off $750 support payment issued by the Australian government.

Since April, figures show that online gambling spending has varied, but has remained above 30% of normal spending. The data also shows that men are spending more money than women.

But according to Mr Costello, there is a silver lining to the pandemic, as it means that video poker (known as pokies in Australia) venues are closed. In fact, he estimates that Australians have saved as much as $1.5 billion since the lockdown started and is hopeful that this could have a long term effect:

“I think a lot of those people won’t go back. For the first time they’re saying ‘I’ve paid my rent, I’m not feeling ashamed of myself.'”

Online gambling usually makes up only $1.2 billion out of the $24 billion lost by Australians to gambling every year, with pokies responsible for $14 billion.