Traders and retailers that use prize promotions to market products and services will need to take into consideration changes introduced by the Gaming and Lotteries (Amendment) Act 2019 ("G&LA") from 1 December 2020. This will mean understanding and taking account of these new laws in marketing campaigns planned for any time after 1 December of this year.
Similarly gaming and gambling operators have additional rules to comply with when operating their businesses.
1 What's New? Prize Promotions, Competitions & Lotteries
No permits required for small lotteries run to sell or market a particular product: Brands have long struggled with Ireland's lottery regime, which often requires games of skill or free entry routes in marketing campaigns to avoid operating illegal lotteries. Now lotteries can be used to sell or market products (but not services) without a licence where certain conditions apply, including that the total value of the prizes is not more than 2,500, and the only charge for the lottery entry is the product purchase price. If relying on this exemption, care should be taken to make sure that the campaign falls squarely within the statutory technical parameters.
No permits or licences required for small lotteries run for exclusively charitable or philanthropic purposes: Small lotteries held for charitable or philanthropic purposes, and not for the promoter's benefit, will not require a permit or a licence. Conditions apply, including that the total value of the prizes is limited to 1,000, no more than 1,500 tickets can be sold, and the price of each ticket cannot be more than 5.
Updated lottery licence regime: Where more than one lottery is run by the same business during a week the maximum prize amount is unchanged at 30,000. A prize fund limit of 360,000 now applies where a single lottery is held during a year. Applications for lottery licences must be made to the District Court in which the lottery will be promoted not less than 60 days in advance of the application. The District Court will consider the applicant's character, the number of periodical lotteries operating in the locality, and the lottery's purpose.
To obtain a lottery licence, the applicant cannot derive any personal profit from the lottery. Importantly the G&LA also states that no more than 75% of the total taking from a licensed lottery may be allocated to prizes and at least 25% must be allocated to charitable or philanthropic purposes. The percentage allocated to prizes and philanthropic purposes was adjusted from that contained in the original draft legislation following extensive lobbying from those in the bingo sector in Ireland.
Updated lottery permit regime: The G&LA updates the lottery permit regime. The condition that the holder of a lottery permit cannot personally profit from the lottery has been removed. The maximum prize limit remains at 5,000 and the maximum cost of the lottery ticket is 10. If a lottery is held to raise funds for a charity, the permit holder can only retain up to 5% of the proceeds.
New offence; promotion of a lottery: Only an employee or agent of a valid lottery permit or licence holder can promote a lottery, and the lottery promoted must be covered by the lottery permit or licence. Failure to comply with this requirement is an offence.
Minimum age limit: A person operating a lottery is prohibited from taking a stake from someone under 18 years of age.
2 What's New? Changes for Gambling Operators:
Minimum age limit: The G&LA has introduced 18 years of age as the legal age for all gambling, including for on course and tote betting.
Sanctions for not paying out on bets: Enforcement of bets in Ireland has long been a problematic area. The G&LA now introduces a range of sanctions in circumstances where an operator unreasonably refuses to pay sums due to those placing bets.
3 What's New? Changes for Gaming Products:
New gaming permit regime and updated gaming licence application: The G&LA introduces a new concept of a gaming permit. Gaming permits can be issued by a Garda Superintendent for gaming on a premises in his or her district for either charitable or philanthropic purposes or for the personal benefit of the holder. To secure a gaming permit certain conditions and restrictions apply, including that the chances of all players, including the banker, must be equal.
The rules applicable to gaming licences have also been reformed. The District Court may attach conditions to the gaming licences it issues, including conditions limiting the hours during which gaming may be carried on, restricting the kinds of gaming available, and the extent to which particular kinds of gaming may be engaged in. There will also be a `Register of Gaming Licences' which the Revenue Commissioners will establish and maintain.
Changes to maximum stakes and per game prize limits: For gaming machines, operated pursuant to a gaming licence, the stake is limited to 5 per player, and no player may win more than 500 in each game. These are significant increases to current limits. For gaming carried out pursuant to gaming permits, the maximum stake will be 10 per game, and the maximum prize limit per game will be 3,000.
New offence; promotion of gaming business: Only an employee or agent of a valid gaming permit or a gaming licence holder can promote gaming, and the gaming promoted must be covered by the permit or licence. Failure to comply with this requirement is an offence.
The previous prohibition of promoting or facilitating `unlawful gaming' will no longer exist; "unlawful gaming" will simply mean gaming that is not subject to a gaming permit or a gaming licence.
Minimum age limit: A holder of a gaming permit or licence is prohibited from taking a stake from someone under 18 years of age.
4 What does it mean for my business?
Consider if you need to take the following actions:
- Review and revise your terms and conditions for the running of promotions, competitions, gambling products, lotteries, and gaming activities to reflect the new changes and ensure compliance.
- P lan appropriately, with due regard to adjusted timeframes for applications, to secure any permits or licences required to carry on business.
- Re-evaluate all your commercial models and products in terms of changed compliance requirements and risks.
- Social media companies, advertisers and broadcasting organisations are likely to take account of the new enforcement regime so make sure you have understood any new obligations in advertising or promoting regulated products.
- Ensure that those responsible for running these activities in your organisations are aware of the adjusted risk profile associated with non-compliance in this area. Consider running workshops or education programs.
Individuals and corporate entities found guilty under the G&LA may be subject to fines of up to 5,000, and/or six months' imprisonment on a summary conviction. More serious offences, prosecuted on indictment, will attract fines of up to 50,000 and/or two years' imprisonment for those involved. Gaming or lottery licences or permits awarded to those who commit offences may be revoked. We are more likely to see operators, traders and brands take greater care with their promotions, competitions, lotteries, betting and gaming businesses following introduction of the G&LA.
We are told that the new laws anticipate further future comprehensive reform. The "Programme for Government 2020" signals an intention 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". However we have been hearing about long promised reform in this area during successive governments; how the new government will respond to calls for reform within this sector remains to be seen.