Gambling Without A Licence

Raffles are a common and often effective way to raise additional funds for your charitable organisation or cause. A less known fact however, is that the gambling commission defines raffles, tombola’s, sweepstake’s as lotteries. This brings distinct regulations that affect the type of lottery you can run, the lottery license which may be required, your ability to give away prizes and how any money made can be spent. Here’s our guidance on organising small lotteries/ running a raffle for charity.

What does the Gambling Commission define as a lottery?

The Gambling Commission determines there is three essential elements to a lottery, these being:

Operating without a license leaves you open to being shut down and being blacklisted from acquiring an online gambling license in the future Failure to adhere to a particular jurisdiction licensing requirements can have dire consequences including ruined reputation, hefty fines, and even criminal proceedings. If you provide facilities for remote gambling (online or through other means), and advertise to consumers in Britain, you will need a licence from the Gambling Commission. Local licensing. The basic requirements gambling business owners need to meet to obtain a gambling license include giving a detailed description of their business and the type of gambling operation the company intends to run. All accounting and data reports need to be submitted for revision as well.

• Payment is required to enter the game.
• There must be a minimum of one prize.
• Prizes are awarded purely on chance.

A standard small society lottery is most often a charity raffle in which players purchase a ticket with a number on, the tickets are then randomly drawn and the individual whose ticket matches the drawn ticket wins a prize.

A slightly different version to the standard raffle is a sweepstake. In this instance for example the participants pay to randomly draw a team in a sporting event. The person whose randomly drawn team wins the event, will win a prize.

In addition to the three essential elements of a lottery listed above, all lotteries (with the exception of incidental lotteries) have another element In common. All tickets must be the same price, that way each participant has an equal chance of winning based on the same outlay. As mentioned above, incidental lotteries are the one exception to these raffle rules.

The distinct types of lottery as stated under the Gambling Act 2005

The gambling commission has divided the types of lotteries into eight distinct categories, each with its own rules and limits, check out a brief description of the categories down below:

Lotteries that require permission

Small society lotteries:

The society in question must be exclusively for non-commercial purposes, common examples of groups organising small lotteries include sports groups, charities and cultural organisations.

For lotteries of this type there is a £20,000 top limit for ticket sales. In addition tickets must display the name of the society or local authority, the price of the ticket, the name/address of the organiser and the date the draw will be held.

Large society lotteries:

This is essentially the same as for small society lotteries except a minimum of £20,000 in ticket sales in required.

Local authority lotteries:

These are lotteries run a local authority, normally as a method of combating the expenditure it routinely incurs.

Lotteries that do not require permission

Private society lotteries – These must raise funds In order to support a good cause or for the purposes for which the society is conducted.

Work Lotteries – Only for colleagues who work at the same single set of premises. These must either; make no profit, meaning proceeds are used for reasonable expenses/ prizes or must be raising funds for a charity or good cause.

Residents lotteries – Similar to the above but for individuals who live on the same single set of premises.

Customer lotteries – These must be run by a business, within its own premises and for its own customers. This type of lottery is not allowed to make a profit and so is unsuitable for fundraising. No prize can be more than £50.

Incidental lotteries – These can be held at commercial events and non-commercial events and must always be for a charitable purpose or other good cause. They can never be run for private or commercial gain. All tickets must be sold at the location/time of event, however the draw can occur after the event has ended. No more than £100 can be deducted for expenses and no more than £500 spent on prizes.

So what about when a licence is required?

As mentioned above a licence is only required for: Small society lotteries, large society lotteries & local authority lotteries and each can be obtained in distinct ways each with different rules and regulations.

Small society lottery Licence:

A small society lottery licence can be obtained through your local authority (You can find your local authority here if you are unsure). You will be required to complete a registration form and return it to your local authority office.

So what does a small society lottery licence cost? Licences of this type come with an initial registration fee of £40 and an annual fee of £20.

Large society lottery Licence:

A large society lotteries licence, unlike a small society lottery licence has to be obtained through the gambling commission directly, further information on how this can be achieved is available here.

Local Authority Lottery Licence:

Gambling Without Id

All local authority lotteries must be licensed by the Gambling commission as with large society lotteries. Full information on the rules, regulations and how to apply for a licence are available here.

Additional Legal Requirements

Once your completed running a raffle/ lottery for charity, a submission must be made to the local council within three months of the draw. In return they’ll send you a template requesting further information, including;

• Full details of the draw(s), including date of sale(s), date of draw(s) and the arrangements for prizes.
• The proceeds of the draw(s).
• The amounts deducted in respect of prizes.
• The amounts deducted in respect of costs incurred of running the draw(s).
• Any amount applied to a purpose for which the promoting society is conducted.
• Expenses that were paid for other than by deduction from the proceeds.

Planning on Running A Charity Raffle / Organising small lotteries? We can help!

Its important to remember that should something go wrong, your organisation could be liable for any damage caused or regulations broken. If you’re planning on running a charity raffle or organising small lotteries, find out how you can help protect yourself, your volunteers and your ability to trade.

Can’t get enough? Check out another of our charity/ nonprofit posts:

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Gambling Without A Licence License

Before a business owner secures the license permission to function, a set of sector-specific license requirements and compliance rules must be met.

A primary purpose of such procedure was designed to determine the behaviour of everyone associated with a particular gambling organisation in order to eliminate the faintest deviation from the jurisdiction’s protocol. Documented information about a business owner, business partners and employee should be provided as a result.

Basic terms and conditions of the Gambling Commission:

• a detailed description of gambling business: an owner of the gambling business should provide the detailed and current information in a particular field of gambling he is planning to run;
• accounting data reports and auditing information;
• a clear description of games offered to the visitors, games specification and system functionality.

Requirements for the owners of gambling businesses:

The regulations of various jurisdictions can vary, however, the license is a must for any authorised gambling business entity that has implemented proper business-planning efforts to stay solvent.

The requirements for obtaining the license for gambling companies are almost the same as for financial companies, insurance companies, banks, exchange offices, etc. They primarily concern accounting and auditing, in addition to functionality of the games and a detailed description of the company’s business activity:

• A good reputation is an asset, which includes: the lack of criminal responsibility, verified identity, proven credit track record, positive credit history information of the owner and employees;
• Detailed summary information on the structure and finances to determine whether the company possesses sufficient resources for the full-fledged business in the field of online gambling.

Employment data requirements:

Gambling Without A Licence Application

The primary requirement for almost every jurisdiction is that one of the directors of the company has the citizenship of the country, where the license will be issued. The development of some other rules that will exclude the possibility of applying for a business license in the field of gambling to persons who do not have the sufficient experience in this area as well as the necessary financial capacity is also possible. In a case of non-compliance with certain gaming license requirements, a gambling committee may reject an application for a license. If approved, the company agrees to conduct their business under the laws of the given jurisdiction.

To facilitate the process of obtaining a license, many gaming committees offer to split for a few jurisdictions in the country. If the company plans to start working in one of the online gaming niche-fields, GamingLicensing experts will gladly help you every step of the way, ensuring a smooth application process.

GamingLicensing team of professionals will provide a detailed information covering all the major nuances on how to obtain a gambling license in certain jurisdictions, that would be tailored to your particular needs and budgetary Basically, you’ll get a bunch of highly experienced professionals who will make sure your company fits all of the gaming license requirements and is ready to run a successful business.

FAQ

Gambling License Application

How To Get A Gambling License

1. Who issues gaming licenses to gambling companies?

   Gaming licenses are issued by special commissions called gambling commissions. It is in their jurisdiction to issue gambling licenses, regulate online gambling, and decide which gambling companies are eligible to obtain a license based on their business conduct and codes of practice.

2. What are the basic requirements imposed by gambling commissions?

   The basic requirements gambling business owners need to meet to obtain a gambling license include giving a detailed description of their business and the type of gambling operation the company intends to run.

   All accounting and data reports need to be submitted for revision as well. Also, you need to provide an unambiguous description of games offered to players, as well as the games’ specifications and functionality.

3. Are there any requirements for business owners?

   Business owners are required to submit financial reports, bank statements, and credit card rating reports to prove their companies are financially capable of maintaining a full-fledged online gambling business. Moreover, a good reputation and a lack of criminal record are considerable assets.

4. Are there any employee-specific requirements?

   Almost all gambling commissions require that at least one of the company directors is a citizen of the country where the license is to be issued. Also, considerable expertise in the gambling industry is required from the company’s employees since that will guarantee the stable operation of the gambling business.