The gambling sector has faced regulation since its inception, with many forms of gambling restricted across various territories. The UK has led the way in online gambling regulation, with the creation of the UK Gambling Commission in 2005 following the Gambling Act of the same year.
The Commission’s latest range of regulatory measures have been introduced to safeguard the most vulnerable customers, and they are the latest in a long list of regulatory changes intended to ensure the safety of anyone gambling online.
Since its broad legalisation in the 1960s, gambling in the UK was largely undertaken through high street betting shops, bingo halls and amusement arcades. The advent of the Internet resulted in the expansion of online betting and casino houses and, like many industries, additional regulation became necessary. These regulations have included limiting stakes on fixed odds betting terminals, introducing responsible gambling tools for all online casinos and betting companies and new regulations designed to make online casino games less intense and safer.
Will online casino games follow restrictions imposed on fixed odds betting terminals in 2019?
In 2016, a UK Gambling Commission study reported that 14% of fixed odds betting machine (FOBT) users were problem gamblers. After two years of subsequent debate, the UK government announced that the maximum stake for such machines would be reduced from £100 to £2. This announcement was ratified by Parliament in 2019, in a bid to protect customers who became addicted to the machines. The loss in tax revenue would be supplemented by increased duty on online gambling.
From this point, the industry felt it was that it was only a matter of time before similar measures were introduced to online casino games. In the Gambling Commission’s round of measures announced in 2021, a range of restrictions were introduced to bring online casino games more in line with their land-based counterparts, though no maximum stake limits were announced. The imposed restrictions included minimising spin speeds, permanent bans on auto-play features and restrictions on misleading in-game features, such as those that celebrated losses as wins. By presenting online casino game players with fairer representation of losses and breathing space to take stock between spins, the move offers higher levels of protection than were seen previously.
Online gambling firms bids to self-regulate deemed insufficient
Faced with growing regulatory pressure and media scrutiny, some of the biggest betting and gaming companies signed up to a series of pledges in 2019 in a bid to self-regulate. 10 betting and online gaming firms, including Bet365, Playtech and GVC, signed up to the measures that aimed to prevent underage gambling and protect young people, increase support for treatment of gambling harm and promote a culture of safer gambling. However, the UK Gambling Commission deemed these measures insufficient, and pushed on with a series of reforms intended to further safeguard online gamblers. Would we see the same level of regulatory control if online casinos and sports betting operators had acted sooner? It is impossible to say, although there is a school of thought within the industry that these measures were inevitable.
One such reform was a ban over the use of credit cards at online casinos and betting firms. A series of high-profile news stories emerged in which online gamers had run up tens of thousands of pounds worth of debt on their credit cards, making deposit after deposit at online casinos. In some cases, these gamblers tragically took their own lives, once again bringing the debate into the spotlight as friends and family of the deceased looked for answers as to how regulators could allow this to happen. It is precisely these cases, where gamers are not in control of their actions and do not have the capability to stop themselves from continuing to make deposits and recognise how much they have wagered, that make regulatory control over how much players can deposit and spend at online casinos essential.
Not all territories enjoy the same levels of regulation as the UK
In some overseas territories, such as France, Japan and New Zealand, online slots are banned completely. This has led to online casino fans in those countries playing on sites located elsewhere, effectively spinning online slots at sites located in territories with less regulation. As such, those players enjoy far less protection than when playing at a site in their own country licensed by an official body. In 2018, the US Supreme Court legalised sports betting, though individual US states have the final say on which sports betting and online casino services are allowed. Those states that have licensed online casino providers operate online casinos within state lines, meaning that, at the time of writing, New York slots players can’t register with online casino sites in New Jersey. As in the cases of France, New Zealand and Japan, this state by state operation opens the US gambling industry up to abuse. As such a new territory to the online gambling industry, time will tell how the US deals with those challenges.
There is no doubt that the online gambling industry provides challenges for players and gambling companies alike. Any industry that is open to abuse requires regulation, and the UK Gambling Commission’s mission statement to make gambling safe, fair, and crime-free is finally bearing fruit. If you can afford to gamble, then in the UK you will be allowed to do so. The arguments over a Big Brother nanny state only go so far, as previous studies on problem gambling have shown. Tight regulations are there to safeguard players and to ensure that businesses are incentivised to thrive in socially responsible ways.
David Williams from Casino Kings.