Gambling Commission publishes update to new direct marketing requirements

On 27 August 2024, the Gambling Commission (the “Commission”) published an update (“Update”) confirming that Social Responsibility Code 5.1.12 (“SR Code 5.1.12”) will be revised following industry feedback. Having also extended the implementation date, gambling operators (the “Operators”) will be required to comply with the new SR Code 5.1.12 from 1 May 2025.

Background

In May 2024, the Commission published its response to a consultation (the “Consultation”) on proposed changes to the Licence Conditions and Codes of Practice (the “LCCP”) requirements. One of the topics consulted on was the introduction of more prescriptive requirements around how Operators must obtain consent for direct marketing. This was one of the recommendations of the Gambling White Paper, published in April 2023. In its response, the Commission confirmed it would introduce a new LCCP requirement (SR Code 5.1.12) under which Operators would need to obtain consent for direct marketing on a per product and per channel basis.

The intention behind the changes to SR Code 5.1.12 is to provide customers with increased preferences to control the gambling direct marketing they receive by requiring Operators to obtain opt-in consent to direct marketing on a per product (e.g. betting, casino, bingo etc.) and per channel (e.g. phone call, email and text messages etc.) basis (the “New Requirement”). This extends the principles of the Privacy and Electronic Communications Regulations which apply to all other businesses sending direct marketing and which, the Commission accepts, already “require[s] a very high bar, and granular level of consent to send direct acquisition e-marketing to new and existing customers.”

Following the Commission’s response to the Consultation, many industry commentators noted there was uncertainty and inconsistency in relation to the New Requirement.

For example, the proposed final wording of paragraph 6 of SR Code 5.1.12 required that “all customers logging into their account for the first time after the commencement date of this provision are required to have confirmed their marketing preferences in line with this condition before they are permitted to gamble” (emphasis added). The Commission received industry feedback that this wording would oblige Operators to deny service to existing customers until they set their marketing preferences in line with the New Requirement. This appeared to contradict to the Commission’s implementation notes which stated: “Upon log-in after the commencement date, any customer that had not set preferences in line with the requirement will need to do so before they are allowed to gamble. Customers that have already set preferences in line with the requirement do not need to be asked again” (emphasis added).

Questions were also raised about whether existing marketing preferences that matched the New Requirement could be shown to customers and/or mapped across to the new preferences.

Update

In response to industry feedback, the Update explained that the Commission had changed the wording of the new SR Code 5.1.12 to “clarify matters”. It said it was “never intended” to require Operators to deny service to customers until they set their marketing preferences in line with the New Requirement.

Paragraph 6 of SR Code 5.1.12 has as a result been updated to the following:

“Existing customers who have not already opted out of marketing must be asked at their first log-in after commencement of this provision to confirm their marketing preferences if they have not done so already. Existing preferences can be copied over providing they match the format of this requirement.”

Impact of the changes

According to the Update:

• New customers: All new customers must be given the opportunity to set their marketing preferences in line with the New Requirement upon signup.
   
• Existing customers:
  • Customers who have opted out of marketing do not need to be shown the new marketing preferences upon first login after the implementation date.
  • If an existing customer has set both marketing preferences for channel and product in line with the New Requirement before the implementation date, they do not need to be asked again.
  • If an existing customer has not previously selected options which match the New Requirement, they should be given the opportunity to select their marketing preferences.
  • If a customer has previously opted into specific products or specific channels, these options can be copied over to the new options when presented to the customer. For example, if the customer has previously selected email as a channel to receive direct marketing but the consent related to all gambling marketing and was not product specific then the existing channel preference can be copied over when presenting the customer with the updated marketing preferences at first login after the implementation date but the product selection must be unticked.
  • All existing customers must have the option to update their marketing preferences at any time.

In addition to the clarification to paragraph 6, the following should be noted:

• the new SR Code 5.1.12 will not include land-based gambling or the lottery sector, which were part of the original proposal;
• the requirement to include post as a form of direct marketing has been removed, as it was deemed to bring only limited benefit for consumers; and
• where an Operator only offers a single product type (e.g. casino only), the Operator does not need to ask customers to confirm their product preference, but is expected to confirm channel preference.

Implementation extended

The Commission has granted an implementation extension to ensure that Operators have sufficient time to comply with the New Requirement. The implementation date for SR Code 5.1.12 will now be 1 May 2025.

Co-authored by Florentina Terholli, trainee solicitor at CMS