Consultation on Relaxation of Non Commercial and Private Lotteries

ON THE DCMS CONSULTATION ON INCIDENTAL NON-COMMERCIAL LOTTERIES UNDER THE GAMBLING ACT 2005

As part of the wider Westminster drive to reduce regulatory burden, the DCMS has released a short life consulation on relaxing the rules surrounding what are known as incidental non-commercial and private lotteries, under the Gambling Act 2005. This may be of particular interest to publicans who have otherwise been prevented from operating fundraising lotteries.

The consultation, which closes on 10 April 2014, can be viewed here.

The consultation relates specifically to incidental non-commercial lotteries, and private lotteries. Incidental non-commercial lotteries are, in short, lotteries which are conducted at an event of a non-commercial nature like a tombola or raffle at a church fete or something of that nature. Such lotteries do not require a licence or permit but certain rules must be observed. These are laid down in Part 1 of Schedule 11 to the Gambling Act 2005, and in the Gambling Act 2005 (Incidental Non-Commercial Lotteries) Regulations 2007 (SI 2007/2040) and set a maximum amount which can be taken from the proceeds of the lottery by the organiser which is £500 for prizes and £100 for running costs. The event itself must be for a purpose other than private gain.

Private lotteries are dealt with under Part 2 of Schedule 11 to the 2005 Act and include three sub-groups of lottery: private society lotteries, work lotteries and residents lotteries. Again, certain rules must be observed in running these lotteries and at present anyone who is running either an Incidental non-commercial lottery or a private lottery should seek specialist advice.

Incidental Non-commercial Lotteries: proposals
This consultation seeks to remove the “Non-Commercial” test from the ability to hold such a lottery. This would mean that various commercial organisations such as pubs and other businesses could host an incidental lottery even if they make profit in running the event (such as from the sale of food or drink) although the bar on making profits from the lottery itself would remain. The existing limits on prizes and costs would remain.

A consideration was given to remove the existing rule requiring the lottery tickets to be sold at the event only (ie not in advance) but this has been rejected as it could lead to incidental lotteries becoming far more organised and this would be at odds with the licensing requirement for larger lottery operators. The consultation does, however, seek to remove the requirement to announce a winner at the event itself.

Private Lotteries: proposals
Private societies would be allowing to fundraise for a cause other than their own.
Work and residents lotteries would remain as is, with the exception that profits would be allowed to be raised but that these should go to a charitable cause (currently no profits may be made at all), would no longer have to provide a specific lottery ticket.

As far as the impact on hospitality premises is concerned, the proposals to amend incidental non-commercial lotteries are to be welcomed, in my view, as they allow greater flexibility for pubs and clubs to run what are clearly charitable lottery competitions without worrying about breaching gambling laws because they make a profit from other aspects of the event such as bar sales.

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About Stephen McGowan

Leading Scottish licensing solicitor at TLT. Chairman of BII Scotland.
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