UK to Loosen Gambling Ad Restrictions

The U.K. Gambling Commission, in conjunction with the Advertising Standards Authority (ASA), will soon publish a new set of draft advertising regulations that will apply to all gambling services, including remote forms, once the Gambling Act 2005 comes into full force in September 2007. It is anticipated that the initial set of proposed regulations will be published in the coming weeks and that a public consultation period will remain open during the summer.

The proposed advertising code has not yet been presented to the public, but there is much expectation that it will relax the current regulatory regime, which dates back to 1968 and is seen by many in the gambling industry to be overly restrictive. At the moment gambling advertisements are limited to providing only factual information about products and services; they may in no way invite customers to subscribe money for gambling.

"Both online gambling and casinos will have more freedom in what they can say," stated Tom Kavanagh, deputy chief executive of the Gambling Commission. "The thinking behind it is really that the current restrictions are around 40 years old. They don't make a lot of sense in the current regulatory environment--the idea that you can't tell people anything about the current availability of casinos."

Due to the antiquity of the current regulations, British-licensed casinos are restricted to advertising only in print, while a loophole allows foreign remote gambling companies to advertise on radio, television, Internet and billboards. The new regulations would permit casinos the same freedoms as other gambling operators.

A spokesperson for the U.K. Department of Culture, Media and Sports told BBC News that casinos are "extremely heavily restricted in terms of advertising," and that "they will, in a limited way, be allowed to advertise more."

He added, "But adverts will be subject to stringent rules about realism and social responsibility, and controls on when, where and what gambling adverts are allowed to do."

It seems likely that while the new code will relax current restrictions, it will still contain checks on advertising content, similar to rules for the advertising of alcohol. Jason Chess, a media lawyer at Wiggin LLP, told British newspaper The Independent, "We will get a sweep of rules which will be not unlike the alcohol rules. The rules say that the industry mustn't advertise in an irresponsible way--for example present gambling as a solution to pay off debt--or show gambling as sexy and cool."

The code will probably also ensure that advertisements do not target minors and other vulnerable groups. The Independent even speculates that advertisements may have to carry warnings about the dangers of gambling.

It has long been expected that advertisements for overseas gambling operations would be banned by the advertising code that accompanies the Gambling Act 2005. Although the United Kingdom has yet to introduce its taxation scheme for remote gambling companies, the rate is expected to be slightly higher than those of most offshore jurisdictions. The ability to advertise in the United Kingdom could, therefore, serve as a benefit that would counter-balance the increased cost of operating there.

After the draft code is published, the Gambling Commission and ASA will seek comments from the gambling industry and the public before publishing the final code that will take effect alongside the Gambling Act 2005 in September 2007.