Legislation designed to regulate the gambling industry could inadvertently “flood” the courts with legal challenges and drive users to black market alternatives, industry analysis has warned.
The Gambling Regulation Bill 2022 covers online and in-person activity and includes powers to control advertising, gambling websites and apps. Some amendments to the Bill are expected next week as it moves to committee stage on Tuesday, bringing it one step closer to becoming law.
However, detailed analysis of the proposed legislation by Regulus Partners, a UK-based global advisory firm focusing on sport and leisure sectors, has identified a number of “serious drafting issues” that it believes could precipitate the kind of litigation experienced in other European countries with similar regulation.
“Without clear wording at the legislative level, key policies which should in theory be delivered by lawmakers are more likely to be shaped by the outcome of legal challenges,” the firm recently reported to its clients.
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The Bill sets out the framework for an independent statutory body, the Gambling Regulatory Authority of Ireland. But Regulus said that with too much ambiguity in the drafting likely to be left to the interpretation of the regulator, matters would end up in court.
In particular, it said, areas of the legislation covering “maximum payments and winnings” would be confusing in practice, and that proposed advertising restrictions remained unclear. The latter criticism is also applied to obligations on providers not to offer inducements.
Regulus points out that the risk of unclear legislation ending up in court has been demonstrated in 13 European countries, including Germany, where more than 100 actions are pending. Such actions are now “accelerating”, it found.
In the area of gambling advertising controls, the analysis said that although a “near blanket electronic advertising ban” is not proposed, it remains unclear exactly what is.
“In a decade’s time, the drafting is likely to look extremely archaic, in our view, meaning it is not fit for purpose now,” it said. However, one of its four analysis reports notes that aspects of the Bill involving gambling inducements to customers “is the sentence that potentially destroys the Bill if left unchanged”.
“All existing online gambling customers are used to receiving inducements, and many seek them out,” the report notes. “It is reasonable to assume that if existing customers suddenly stopped receiving the inducements that they had become used to, they would use the internet to start looking for them. In other words, [that aspect of the Bill] is an invitation for both existing and new customers to seek out the black market.”
The concerns come at a time when legislators are due to debate potential changes to the legislative drafting. Speaking in the Dáil earlier this week, Minister of State for Law Reform James Browne said a key focus of the Bill was to “protect children and vulnerable people from the harms associated with gambling”.
The analysis reports note that when a legislative framework is “principle-based” along such lines, such latitude can provide effective flexibility that can be adapted. However, it continued, a lack of clarity can be “very dangerous”.
Other measures contained in the Bill include a watershed prohibition on gambling advertising on television, radio and on audiovisual media between 5.30am and 9pm. It would grant a “wide-ranging power” to the regulator to decide the times, places and events where gambling advertising could be broadcast, as well as its frequency and volume.
Addressing the need for protective legislation late last year, Mr Browne said “everyone, including children, can now carry a mobile casino on the phone in their back pockets”. He said this made it vital “to have a robust regulatory framework with public safety as a cornerstone”.
