Having successfully transferred alcohol and entertainment licensing to local councils the Government is preparing the industry for a similar exercise for gambling.

The Gambling Act 2005 modernises the law on gambling covering everything from the much heralded super-casino to dog and horse tracks, betting offices, prize bingo and the humble fruit machine in a corner of the pub. The key objectives of the Act are to make gambling fair and open, crime-free, and to provide protection for children and vulnerable people.

Implementation is set for 1 September 2007 with various cut-off dates for applications to be made to help ensure continuation of business for existing operators.

What are the main changes brought about by the Act?

Regulation of the Act will be split between the newly formed Gambling Commission who issue operating licences to providers of commercial gambling, codes of practice, and personal licences. Licensing Authorities (local councils) will issue premises licences and a range of permits while the Government will be responsible for regulations and can set central licence conditions.

Gambling will be unlawful unless covered by a licence, permit, registration or exemption provided for by the Act. The Act introduces licensing objectives, temporary use notices and a raft of regulations - some of which have yet to be approved by Parliament.

Gaming machines will be regulated under the Act and have been categorised according to the maximum stake and prize value. Age restrictions will be applied, prohibiting play of the higher stake/prize machines by anyone under the age of 18.

However, by way of balancing the bureaucracy, there are some exemptions. For example, pubs currently wishing to operate up to two fruit machines must obtain permission by means of a notification to the licensing authority, for which they have automatic entitlement. A one-off fee will be payable but thereafter the permission will be of unlimited duration and you will not need to apply again unless your circumstances change.

In addition, alcohol-licensed premises will no longer be required to seek permission from their local licensing authority for games of ‘equal chance’ to take place provided certain conditions are met. These include that children and young people must not participate and that gaming is limited to ‘equal chance’ games such as cribbage, dominoes or poker between customers for small stakes. Games like roulette and blackjack will be prohibited.

So what does this mean for businesses?

To help ensure a smooth transition for businesses, the Government has committed to guarantee certain rights for existing operators. These rights will be continued or converted into the equivalent permissions under the new Act.

However, existing operators need to take action now to ensure that they meet the deadlines for the transition. For example, pubs wanting to increase the number of fruit machines they offer to three or over will need to apply to their licensing authority for a new licensed premises gaming-machine permit at least two months before their existing permit expires.

In addition, to meet the new age restrictions for fruit machines, businesses with a children’s play area will need to review the machines available for use in that area and consider any changes that may be required.

The scope of the Act is wide ranging and will require a good deal of paperwork to be completed but, good forward preparation will help to make the change as pain free as possible.

Further information on the Act can be obtained from the Gambling Commission website, www.gamblingcommission.gov.uk or the Department of Culture, Media & Sport on www.culture.gov.uk