National Lottery Could Be Suspended For First Time Amid Ownership Rows
The UK National Lottery has been running for 28 years, and while it may have had its ups and its downs, and a series of blips along the way, it has never once been suspended under Camelot’s ownership. Yet that could all be due to change, thanks to the row that is currently taking place regarding the new licence, which is to be awarded to Czech-owned brand Allwyn in February of 2021.
Camelot, which has been serving as the operator of the lottery since 1994, has submitted a legal challenge to the High Court regarding the loss of the licence to Allwyn. And because of that, the handover to the new licensee could very well be delayed. As a result, The National Lottery itself could be suspended while the matters are resolved. While 2024 is still a long time away, warnings were put out stating that it would leave Allwyn with insufficient time to set up its own operations, with 19 months being needed to prepare for its takeover launch.
Of course, if there was a delay in lottery draws, it would mean that not only would avid players suffer, but that good causes across the United Kingdom which usually receive funding from such could also be deprived of much-needed cash. Now, the UK Gambling Commission is requesting that the High Court reverses a previous ruling which would determine that the handover process of the lottery be suspended depending upon the outcome of the legal challenge from Camelot.
Camelot Pushes Commission To Delay License Transfer
Despite the fact that the Gambling Commission has been pushing for no delays to occur, Camelot has been putting pressure on the regulatory body with regard to the official licence of the lottery. The former boss of the current operator said that it should delay the transfer of the licence over to Allwyn, stating that it is a relatively straightforward solution. Through doing so, she stated that it would
“avoid any unseemly and unnecessary haste in legal proceedings”,
further mentioning that it would remove the risk to good causes as well.
According to Lord Pannick QC, the court case which is due to be heard later on in 2022 via trial could end up causing significant problems for the country’s good causes currently receiving funding from the lottery.
One of the big factors that led the Commission to choose Allwyn as the new licence-holder for The National Lottery was that it intended to donate £38 billion to good causes over the next ten years. That’s precisely the timeframe that the lottery licence lasts, and likely helped to sway the decision makers. Yet Camelot was swift to state that the Commission decision on appointing Allwyn as the new licence holder for the UK lottery was a “badly wrong” one. It went on to claim that it is a decision which could put the firm out of business.
The High Court is expected to give a ruling this week on whether or not The National Lottery will be suspended if issues are not resolved before February 2024. If this did come to pass, then it would mark the first time in the game’s history that it has ever been suspended.
The Gambling Commission has repeatedly stated that it ran both a fair and robust competition for the lottery licence. And while it was mentioned that Camelot would be missed, the regulatory body regrets that things have gone to court. Allwyn also said that it was “complying fully with the Gambling Commission on all aspects” relating to the competition to receive the lottery licence in the UK.
High Court Challenge by Camelot
In a statement, the CEO of Camelot, Nigel Railton said that the company is “launching a legal challenge” in its capacity as an applicant for the fourth lottery licence. It went on to state that Camelot firmly believes it was the wrong decision of the Gambling Commission to select Allwyn as the new licence holder.
“When we received the result, we were shocked by aspects of the decision”, said Railton. “Despite lengthy correspondence, the commission has failed to provide a satisfactory response. We are therefore left with no choice but to ask the court to establish what happened”.
The four-way battle that took place for the licence, which also included Sisal (owned by parent company of Paddy Power, Flutter) and Richard Desmond, saw Czech billionaire Karel Komárek’s Allwyn brand secure the victory as the most impressive candidate. Almost instantly, Camelot was up in arms over the loss of the licence, having held on to it since 1994.
The Gambling Commission said that it is confident in the idea that the legal challenge from Camelot would fail.
“We regret Camelot’s decision to bring legal proceedings following the outcome of a highly successful competition for the fourth national lottery licence”,
commented a spokesperson for the UKGC.
“We have taken every step possible to ensure a level playing field for all interested parties, to enable us to appoint a licensee who will engage and protect players, run The National Lottery with integrity and ensure The National Lottery continues to support good causes and their contribution to society”.
But Camelot backed up its legal challenge by saying that it is quite possible the company will cease to exist should Allwyn actually take over the licence in 2024. The company is actually a Special Vehicle Company (SPV), which was set up solely as an operating body for the lottery when it was first launched. Therefore, the agreement it is signed into now with The National Lottery means that Camelot is only able to carry out jobs relating to the lottery and its games.
This point was brought up by Sarah Hannaford, QC, who represents the Gambling Commission. She went on to argue that Camelot losing the licence is simply a “hazard” of contracting with such a public body.
“Setting yourself up as an SPV and then saying there is an existential threat simply does not work as a matter of law in my submission. Camelot UK took a decision to operate as they did, and it was perfectly foreseeable that they might lose a contract”.
Ms Hannaford went on to state that the only “legal loss” to Camelot is a loss of profit, and that could be remedied with damages sufficiently.
But two other companies have also issued claims against the Commission, those being Camelot Global and IGT, which is responsible for the lottery technology utilised by Camelot. Both of these are sub-contractors to Camelot UK with regard to the lottery licence, and both have claimed that they will suffer losses as a result of the Commission awarding the licence to another party.
