Authority figure: handing new powers to Ireland's first gambling regulator

Unpredictability no longer stems from what betting industry reform in Ireland looks like – that is now known – but rather how it will impact the sector’s €7bn (£5.8bn) business. A significant first step takes place in the coming weeks when an international recruitment campaign kicks off to find Ireland’s first gambling regulator – who will be “extremely powerful” according to the legislator leading the search. The regulator, ‘CEO designate’ of the Gambling Regulatory Authority of Ireland, will be in place more than a year before new laws are passed through the General Scheme of the Gambling Regulation Bill – currently presented through 142 different ‘Heads’ which will be drafted by the Attorney General.

The draft, published before Christmas, is likely to include more ‘Heads’ before its publication into a final piece of legislation this summer. When it’s brought before Dublin’s houses of parliament (Oireachtas) to be passed into law next year, it will be the largest bill of its kind in Irish legal history. As extraordinary as its detail and complexity is the breakneck pace which has gone from concept to published bill in just two years – a whirlwind by Irish political standards.

In an interview with EGR Intel, the state legislator charged with introducing such far-reaching reforms said the need for change is a “priority for government”, in an industry which “lost the run of itself”. James Browne, junior minister at the Department of Justice, is fuelled by a general intolerance of many aspects of betting, so much so that he has refused to be lobbied or spoken to by the industry as he drafted the General Scheme.

Neither is he concerned with how regulation may impact exchequer revenue: “I have really no consideration on loss of revenue – we’ve not done a financial impact audit.” Browne’s determination to move quickly, without outside influence, comes from an order directed by Irish Prime Minister (Taoiseach) Micheal Martin, when he came to office in June 2020. Martin commissioned the junior minister to impose regulation and legislative change by the time the Taoiseach hands power back to coalition partners at the end of this year.

To ensure greater efficiency, the minister first met with the Attorney General to ensure the bill is legislatively sound from the outset, without the need for lengthy legal scrutiny and tweaking at the end of the process. For someone so driven by enforcement, Browne assures he “is not anti-gambling” but is concerned about addiction issues which have not been helped by inadequate laws.

Terms and conditions

Regulation will present across a range of headings, including licensing, compliance and enforcement, but its greatest impacts will come through ‘Safeguards, Advertising and Sponsorship’.

Highly restrictive measures to ban digital and broadcast ads at certain times of the day will present enormous brand challenges on how bookmakers speak to and communicate with their audience. The non-broadcast aspect of brand visibility will have profound impacts on the high street, with betting shops set to be hit hard – proposals to be considered by the regulator include display signage on shops, where even the name of the bookmaker on shopfronts may be deemed as advertising. If the regulator sees through with such threats to end “in your face, gaudy betting offices”, the cost will be in the tens of millions through remodelling fees and the loss of valuable media and marketing presence.

Independent bookmakers and chains like BoyleSports – a firm which invests heavily on retail versus Paddy Power and Betfair’s online dominance – will be staring down the barrel of significant cost. Despite the turbulent times ahead, CEO of Flutter for UK and Ireland Conor Grant tells EGR Intel that the world’s largest sports betting and online gaming business has been “a long-time advocate for a fully regulated market in Ireland”.

“[We] warmly welcome the recent progress on legislation [and] believe Ireland has an opportunity to develop a world-class regulatory authority for sports betting and gaming, with the ability to adapt and evolve over time, given the dynamic nature of the sector.

“As a business, we have been leading considerable change in Ireland [having] recently announced plans to become the first operator to introduce mandatory spending limits for Irish customers under 25. This follows on from several progressive initiatives, such as a ban on the use of credit cards and the introduction of a pre-watershed ‘whistle-to-whistle’ advertising ban on televised sport,” he explains.

Regulation (in the UK, particularly) bears a mild responsibility for Flutter’s share-price dipping over the past 12 months, dropping in value from 15,500p to 11,360p (-27%) in the 12 months up to 14 January. Any slippage stems mainly from uncertainty about the US market, where the current gold rush is raising questions about the true value of the newly awoken American gambling sector and pending interest rate increases.

Safely does it

Flutter’s ‘doing better’ approach is mirrored by the Irish Bookmakers Association (IBA), which represents all of the big firms and a large number of independent bookies. The IBA has introduced changes to ‘whistle-to-whistle’ advertising and to credit card deposits through its Safer Gambling Code, another effort by big betting companies to demonstrate greater responsibility.

This safety-first action, in a country where negative media perception towards the industry has mushroomed in recent years, has not convinced the architect it needed to. Browne has “a lot of criticism” for the efforts firms are making to show how responsible they are, a topic he shuts down quickly as “nowhere near enough”.

“If the changes they’re making were enough and if they were going to be strictly adhered to, there’d be no need for legislation,” he says. “While I do welcome [the changes], it is very late in the day and it’s nowhere near enough. You do question if any of it would be done if there weren’t changes coming in. I would like to have seen this done a long time ago, no reason they couldn’t have done it 10 or even 20 years ago, and I would have a lot of criticism for them over that.”

IBA chairperson Sharon Byrne said the association “will continue to identify ways we can improve the effectiveness of these measures, while the legislation is developed”.

She added that the IBA supports “a properly resourced body, established as soon as possible, to regulate this ever-changing sector [to] ensure all operators do apply and abide by the highest of standards”.

For bettor or for worse?

One alternative view to gambling regulation comes from a now keen supporter of reform, Paddy Power founding member Stewart Kenny. Kenny wonders why laws alone are not enough and why there’s a need for a regulatory authority. “Is there a regulator for driving? No,” says the man most responsible for the ‘PP’ brand and a founder of ‘Stop Gambling Harm Now’. “I would say that there are laws to deal with road safety, the Department of Transport doesn’t just set up a driving regulator.

“I mean the government is there to regulate, so I don’t see the need to hand it over to some bureaucratic power or a figure from the Department of Justice. I fear that it will eventually become another quango, an office with a growing number of employees being added to it, and one that doesn’t really do anything effective,” he adds.

When I spoke to Browne about the ‘quango’ question, he disagreed and reiterated the point when we saw each other recently, stating that the authority would be “extremely powerful”, especially around issuing sanctions. “The office will have the power to remove licences, with a maximum of €20m in fines or a 10% fine of relevant turnover,” he adds.

The Irish government has set aside a budget of €700,000 for the preliminary formation of the authority, which will eventually be staffed by up to 100. “The important thing is that it’s ready to go by 2023, once gambling regulation is passed into law and the two dovetail together,” the minister continues.

The regulator will have the added comfort of initiating changes to law, with ministerial approval and as the technological environment demands, without the need for repeatedly returning for house approval.

With such power comes a relatively modest salary of around €200,000 (approximately). However, the opportunity to lead historic change to the Irish betting industry will be priceless for the right candidate. What the price of that change is for the industry is the great racing uncertainty.