The UK's "super-casino" Proposal is Finally Abandoned

This article was produced by Olswang LLP, which joined with CMS on 1 May 2017.

The ongoing saga of liberalisation of the UK's casino industry seems to be moving slowly towards its ultimate conclusion. Further to our last update Andy Burnham, the new Secretary of State for Culture, Media and Sport, has finally confirmed reports that the Las Vegas-style "super-casino" allowed under section 175 of the Gambling Act 2005 ("Act") will not be authorised by the Government.

Mr Burnham's announcement followed months of speculation that the "super-casino" would be abandoned following intense lobbying from the media and religious groups. Shortly after becoming Prime Minister, Gordon Brown announced a review of the proposal last July. This review, published in February 2008 (see here), examined the evidence of whether regional casinos are the best way to regenerate specific deprived areas. It concluded that the benefits from a regional casino could be reaped through "alternative, but equally effective projects", for example museums, theatres, retail, commercial and housing developments.

The Gambling (Geographical Distribution of Large and Small Casino Premises Licences) Order 2008, laid before Parliament on 26 February 2008, permits sixteen local authorities to license a small or large casino, and confirmed that the Government would not permit a regional casino (as the "super-casino" was described in the Act) at this stage. The sixteen locations are the same as those recommended by the Casino Advisory Panel in its January 2007 report (see here).

Large casinos: Great Yarmouth, Kingston-upon-Hull, Leeds, Middlesbrough, Milton Keynes, Newham, Solihull and Southampton.

A large casino will have a total gambling area of 1,500 to 3,500 square metres, will be permitted to offer a maximum of 150 Category B1 gaming machines with a £2 maximum stake and £4,000 maximum prize and will be allowed to offer bingo and betting.

Small casino: Bath and North East Somerset, Wigtown licensing area in Dumfries and Galloway, East Lindsey, Luton, Scarborough, Swansea, Torbay and Wolverhampton.

A small casino will have a total gambling area of 500 to 1,500 square metres, will be permitted to offer a maximum of 80 Category B1 gaming machines and will be allowed to offer betting.

The sixteen approved casinos are considerably larger than any of the casinos currently permitted in the UK under the Gaming Act 1968.

It has been reported that Manchester City Council, which had been selected as the location for the sole regional casino, may appeal against the change of plans.

The order will now be debated by both Houses of Parliament, which may only approve or reject the order and may not amend it. The order is the same as that approved in the House of Commons but rejected by the House of Lords in March 2007 save for the removal of the regional casino, the most controversial element. The locations of the large and small casinos were broadly supported during the debates related to that order and neither the Conservatives nor the Liberal Democrats have voiced any opposition, so it is expected that this latest order will be approved by both Houses.

Once approved, licensing authorities may invite and consider applications for the licences. The process for applications for casino premises licences is contained in Schedule 9 of the Act. A two-stage process applies, whereby the authority first considers applications as it would consider applications for any premises licences under the Act. If more than one application remains then the licensing authority must consider which of the competing applications would, in its option, if granted result in the greatest benefit to the authority's area. The DCMS has issued a code of practice in relation to these applications, which is available here.

The Secretary of State also announced a number of other measures, including the introduction of a restriction requiring all casinos in the UK to close their doors for at least six hours a day to prevent 24-hour opening. He also stated that a statutory levy would "become inevitable" if gambling operators failed to make voluntary contributions towards research into and treatment of problem gambling. Under section 167 of the Act, the Secretary of State has the power to make regulations which provide for a specified condition to be attached to premises licences generally or only those in a specific class (e.g. casino licences) or in specific circumstances.