Spreading it about

Wilf StevensonWilf Stevenson on why the Coalition’s proposed gambling legislation risks being a complete mess

Online gambling was first regulated in the UK in 2007. Since then, all but one of our major online betting companies has moved offshore – justifying their decisions by claiming it is necessary to remain competitive. As a consequence, they are now outside UK regulation. 

The need for changes in the licensing of remote gambling operators was first identified by the last Labour government, and much good work was done on the issue before the last election. Given this, we are giving in principle support to this modest, five clause Bill. We do however, have many areas which we think require strengthening – not least because technological innovation has radically changed how betting operates, leaving some quite alarming gaps in the regulatory framework.

One of the most egregious gaps is the failure to use this Bill to better regulate the spread betting market. At present, spread betting is regulated by the Financial Conduct Authority (FCA), whereas all other ‘betting’ as defined in the Gambling Act 2005 comes within the regulatory responsibilities of the Gambling Commission. This means that cheating connected with spread betting is outside the scope of section 42 of the Act.

One practical effect of this is that there are no regulatory obligations on spread betting organisations who suspect illegal activity, to provide a relevant sports governing body or event organiser with information about suspicious betting patterns.  Nor has the FCA the power to issue general guidance on these issues or to make such guidance public – powers which the Gambling Commission have, and use to good effect. 

So we have tabled an amendment to the Gambling (Licensing and Advertising) Bill, now in Committee in the Lords, to transfer the regulation of spread betting from the FCA to the Commission and to require operators who offer spread betting to comply with license condition 15 – that which ensures they must share information and report suspicious betting. A similar amendment has been tabled by Conservative backbencher Rachel Heyhoe-Flint.

Promoting and upholding the integrity of sporting activity is one of the key functions of all sports governing bodies. 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 of its participants are competing fairly and openly to win and that its officials are honest, and are seen to be so. 

Those who seek to influence the outcome or progress of sports events to secure rewards through betting undermine this principle, and any suspicion that this is happening can be deeply damaging. The government must therefore act to ensure that sports spread betting is properly and effectively regulated. 

Lord Wilf Stevenson of Balmacara is a Shadow DCMS Minister in the House of Lords

Published 14th January 2014


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