Blog: Gaming and Lotteries (Amendment) Act 2019 to come into force in December
Rob Corbet and Caoimhe Stafford of Arthur Cox consider some of the key changes that will be brought about when the Gaming and Lotteries (Amendment) Act 2019 enters into force.
Almost a year after it was signed into law, the Gaming and Lotteries (Amendment) Act 2019 will come into effect on 1 December 2020. Among other things, the 2019 Act will update the significantly outdated prize and stake limits under the current legislation, and introduce a standardised minimum age of 18 for all forms of betting.
Under the Gaming and Lotteries Acts 1956-2013, gaming is defined as “playing a game (whether of skill or chance or partly of skill and partly of chance) for stakes hazarded by the players,” while “unlawful gaming” includes any kind of gaming: (a) in which by reason of the nature of the game the chances of all players (including the banker) are not equal; (b) in which any portion of the stake is retained by the promoter or by the banker (other than as winnings); or (c) by means of a slot machine.
The 2019 Act will simplify matters by introducing a cohesive licensing regime for gaming, such that “unlawful gaming” will simply involve any gaming that is not subject to a gaming permit or a gaming licence.
As the 2019 Act does not specifically regulate online gaming, it is expected that operators that are licensed overseas will be able to continue offering online gaming services to Irish customers, subject to those contracts and operations not being subject to Irish law.
Superintendents of An Garda Síochána will have a new power to issue permits for on-premises gaming where the maximum stake is €10 and no player can win more than €3,000 in a game.
The Garda Superintendent will be required to consider the character of the applicant (or of the person exercising control and management over the applicant where it is a corporate entity), the number of gaming permits already issued in the area, the suitability of the proposed premises, and the kind of gaming that will be conducted, including whether it will be conducted for a charitable or philanthropic purpose.
Echoing aspects of the definition of “unlawful gaming” under the current regime, a gaming permit cannot be issued to a person: (a) for any gaming in which by reason of the nature of the game, the chances of all of the players, including the banker are not equal; (b) to promote gaming for charitable or philanthropic purposes on the same day or in the same place as gaming being promoted for other purposes; or (c) to promote gaming by means of a gaming machine.
For gaming machines, and all other gaming where the maximum stake is €5 and no player can win more than €500 in a game, a gaming licence will be required from the Revenue Commissioners (much as it is today).
Before obtaining a licence, the applicant amusement hall must first obtain a certificate from the District Court. While the District Court will no longer have the power to attach conditions relating to prize, stake or age limits (perhaps to ensure the harmonious application of the 2019 Act), it may attach conditions limiting the hours during which gaming can be carried on, restricting the kinds of gaming, and the extent to which particular kinds of gaming may be carried on. As before, the District Court may only grant such a certificate where the local authority has passed a resolution to permit amusement halls and funfairs in their area.
The Revenue Commissioners will be required to create and maintain a register of gaming licences, which will likely be published online in the same manner as the register of licensed bookmakers.
The 2019 Act will further introduce a coherent licensing and permit regime for lotteries, which are currently allowed only in limited circumstances. Whether operators will require a licence or a permit will depend on the value of the prizes.
Where a person intends to run a lottery (or several in a week) and the total value of all prizes is no more than €5,000, the person must apply to their local Garda Superintendent for a permit at least 60 days in advance of promoting the lottery. Tickets for lotteries under a permit cannot cost more than €10, and if the lottery is held for the benefit of a charity, the permit holder cannot keep more than five per cent of the total proceeds.
In contrast with gaming permits, the Garda Superintendent will not be required to consider the “kind” of lottery, but they must consider the applicant’s character, the number of lottery permits issued in the locality and the suitability of the premises (if any)). A register of all lottery permits that have been granted by each Garda Superintendent is required to be maintained.
For more significant lotteries (where the total value of all prizes in a week is no more than €30,000, or no more than €360,000 for a once-per-year lottery), the operator is required to obtain a lottery licence. To obtain a licence, the applicant cannot derive any personal profit from the lottery, every ticket (or the relevant premises) must display the value of each prize and the name of the intended beneficiary, and of the total proceeds: a maximum of 75 per cent may be allocated to prizes; a minimum of 25 per cent must be allocated to charitable or philanthropic purposes; and a maximum of 25 per cent may be retained by the licence-holder for promotional expenses.
The conditions attaching to proceeds have proven to be the most controversial change, particularly among the bingo industry. The initial draft of the Gaming and Lotteries (Amendment) Bill 2019 had capped the amount that could be allocated to prizes at 50 per cent. However, this was revised due to significant lobbying from bingo operators and the Bingo Players’ Association, which lead to protests outside Dáil Éireann.
Applications for lottery licences must be made to the District Court in which the lottery will be promoted at least 60 days in advance. In deciding whether to grant a licence, the District Court will have regard to the applicant’s character, the number of periodical lotteries operating in the locality, and the lottery’s purpose. The District Court clerk will be required to keep a register of all lottery licences that have been granted.
The 2019 Act will introduce a very welcome change for brands and marketing agencies who run prize draws as part of marketing campaigns. Such promotions will not need a licence or permit, provided that the total value of the prizes is €2,500 or less and there is no charge for taking part in the lottery or redeeming the prize (aside from the purchase price of the product).
In a welcome display of pragmatism, lotteries that are conducted for charitable/philanthropic purposes will be exempt from the requirement to obtain a permit/licence, provided that the total value of the prizes is €1,000 or less, the price of each ticket is €5 or less, the maximum number of tickets sold is 1,500, and the promoter does not receive a personal profit and has not conducted such a charitable lottery during the previous 3 months.
The 2019 Act is less favourable for societies and workplaces that enjoyed “private lotteries,” as the exemption for such lotteries will be repealed, meaning that they can only proceed subject to obtaining a permit or licence. That small charitable lotteries can proceed should fulfil the same recreational need provided that operators are happy to take no share of the proceeds.
The 2019 Act will introduce more severe penalties for offences, which include the promotion of gaming and lotteries that are not subject to a licence or permit. A summary conviction will result in a fine of up to €5,000, and/or imprisonment for up to 6 months, while a conviction on indictment will result in a fine of up to €50,000 and/or imprisonment for up to 2 years. Reduced penalties will apply to individuals who obstruct Gardaí in carrying out their responsibilities under the legislation, and to those who make false statements in applications for licences/permits.
Interestingly, some prominent private members’ clubs have announced their closure in the past year due to the strict stake and prize limits and their uncertain status, having unsuccessfully lobbied to be explicitly excluded from the scope of the 2019 Act. Although the Minister for Justice intimated that the 2019 Act merely preserves the status quo for such clubs, which “are not subject to a particular licensing regime,” it is unclear if enforcement activity will align with these statements until specific regulation for casinos is introduced.
The 2019 Act has been widely described as an interim reform measure, pending a more meaningful overhaul of gambling legislation. Although the new Government has indicated in its “Programme for Government 2020” that it intends to “establish a gambling regulator focused on public safety and wellbeing, covering gambling online and in person and the powers to regulate advertising, gambling websites and apps,” it remains to be seen if they will achieve this in the context of the COVID-19 pandemic.
Rob Corbet is a partner at Arthur Cox’s Dublin office and Caoimhe Stafford is an associate also at the Dublin office. The authors would also like to thank Conor O’Brien for his contribution to this article.
This article was first published by the International Masters of Gaming Law on 1 September 2020.