4th National Lottery Licence Competition finally launched

Three months later than originally anticipated, the Gambling Commission has today (28 August 2020) formally launched the competition to award the fourth National Lottery licence.

As previously reported by us here, the delay has been due to the Covid-19 pandemic.

You can download below the Gambling Commission’s ‘Future of the National Lottery’ document that contains information on how the fourth National Lottery licence was developed, a summary of the key improvements in the next licence and the following indicative competition timeline:

  • Selection Questionnaire (SQ): August 2020 to October 2020
  • Invitation to Apply (ITA): October 2020 to July 2021
  • Announcement of preferred applicant: September 2021
  • Fourth licence award: October 2021
  • Transition period: October 2021 to July 2023
  • Fourth licence begins: August 2023

David Clifton’s presentation at this week’s Westminster Media Forum policy conference on The future for the National Lottery was entitled “Placing the National Lottery on a sustainable footing for the future – key priorities for the Licence competition”. In that presentation (that you can download below), David correctly forecast the following key improvements now set out within the Commission’s ‘Future of the National Lottery’ document:

  1. The licensee will be held fully accountable for protecting players
  2. The licensee will be empowered to respond to technological advancements, new opportunities, and changes in consumer preferences
  3. A restructured incentive mechanism will ensure the licensee’s incentives are closely aligned with contributions to good causes
  4. The licence will run for a fixed 10-year period
  5. The outcome-based approach in the fourth licence will provide the licensee with flexibility to innovate, whilst ensuring they continue to meet high standards of player protection and propriety
  6. The licensee will be required to foster stronger relationships with the distributors of National Lottery funding to further strengthen the link between the brand, its players, and good causes
  7. The Gambling Commission will safeguard key features of the National Lottery, for example, by ensuring that the licensee guarantees at least one draw-based game, with life-changing prizes, every week

You can also download below today’s Gambling Commission’s website announcement of the competition launch. It reads as follows:

The National Lottery is one of the world’s largest lotteries and the current (third) licence is due to expire in 2023. Since launching in 1994, National Lottery players have collectively raised more than £41 billion for 565,000 good causes across the UK, transforming lives and contributing to the arts, sport, heritage and communities.

The next licence seeks to build on that success by creating a framework that maximises the opportunities for players and good causes to benefit from innovation and creativity, whilst protecting the National Lottery’s unique status.   

Key changes for the fourth licence include:

  • A fixed 10-year licence: A fixed term means that the licensee has a clear period for investment planning.
  • Focusing on performance: Building on the National Lottery’s success to-date, the new licence will provide greater flexibility to maximise returns to good causes, hand in hand with ensuring safe and fair play.
  • Incentive mechanism: A new incentive mechanism will ensure the licensee’s incentives and delivery are closely aligned with returns to good causes
  • Protecting the brand: The licensee will be required to foster stronger relationships with the distributors of National Lottery funding to further strengthen the link between the National Lottery brand, its players, and good causes.

In 2018, the Commission began an extensive programme of global market engagement to hear from businesses and investors interested in the future of the National Lottery.

Today, interested parties are being invited to take part in the first formal stage of the competition. Applicants that pass through this stage will receive the Invitation to Apply (ITA) and supporting documents in order to begin preparing their application.

The preferred applicant will be announced September 2021.

Neil McArthur, Gambling Commission Chief Executive, said: 

“Today, the competition for the fourth National Lottery licence begins. Over the last quarter of a century, it has made an unprecedented contribution to communities across the UK and has made a difference to the lives of millions.

The National Lottery is a national treasure. It has a reputation for providing enjoyable games and a high degree of player protection, as well as a rich history of prize giving and returns to good causes. We are determined to protect and build on the reputation of the National Lottery.

For the fourth licence, we will be evolving our approach to regulation to build on the National Lottery’s huge successes. In line with our outcomes-focussed approach to regulation, we want the next licensee to have greater autonomy to meet the needs of players in 2023 and beyond, whilst ensuring there is clear accountability for the performance of the National Lottery.

Throughout our market engagement, we have been encouraged by a healthy level of interest from a range of different parties and we look forward to running a competitive process.”

Minister for Sports, Tourism and Heritage Nigel Huddleston said: 

“The National Lottery has a positive impact on communities right across the UK, supporting thousands of good causes as well as the sectors that brighten up our lives including the arts, culture, heritage and sport. The fourth licence competition will secure the National Lottery’s future combining safe play with life-changing prizes. Most importantly it will help raise billions more pounds to benefit people’s lives in villages, towns and cities throughout the country.”

Dawn Austwick, Chief Executive of The National Lottery Community Fund, and Chair of The National Lottery Forum, said: 

“The National Lottery has been at the cornerstone of communities across the UK for 25 years. In this time, National Lottery players have raised £41bn for good causes, supporting arts, sport, heritage and communities and transforming people’s lives. We welcome a strong competition to ensure this success continues for years to come.”


1. On 3 October 2020, Sazka Group announced its entry into the competition for the fourth UK National Lottery Licence. Its press release states as follows:

Sazka Group, Europe’s largest lottery operator, has announced that it has entered the Gambling Commission’s competition to select the operator of the 4th licence to run the UK National Lottery by completing its response to the Gambling Commission’s Selection Questionnaire.

Commenting on the company’s decision to enter the competition, Sazka CEO Robert Chvatal said:

“As a leader in operating lotteries across Europe, Sazka has made no secret of the fact that we would be thrilled to operate the UK National Lottery. The UK National Lottery is a national treasure with a proud 26-year history. Now it is looking forward to the next decade and how it can best serve its customers in a world so disrupted by digital transformation, the fourth industrial revolution and Covid. The landscape from when the UK National Lottery was launched back in 1994 has changed beyond measure.

At Sazka we have a track record of facilitating the evolution of established lotteries to innovate for their successful future.  We are serious about our intentions and respectful of the process we are entering in to.   We submitted our completed application to the Gambling Commission by yesterday’s deadline. This was an important and exciting moment for us, marking our official entry into the competition. We trust that our submission will demonstrate our professional track record and technical capabilities.”

He continued:

“We are in the process of hiring a team in the UK and are building the partnerships and relationships necessary to deliver in due course a compelling case which is based on a clear understanding of the needs and desires of all stakeholders and customers the UK National Lottery touches.”

2. On 20 October 2020, iGaming Business reported that “India’s largest lottery operator Sugal & Damani Group has confirmed that it will participate in the contest for the fourth UK National Lottery licence”, quoting its Group Chief Executive Kamlesh Vijay as saying:

“As a leader in operating lotteries across India and other jurisdictions, Sugal & Damani has shown its deep interest to operate the UK National Lottery since 2007 when it participated and also [was] selected as a reserve bidder by qualifying all required standards like propriety, technology, player protection, channel management, and financial capability.

Being an organisation with deep rooted innovation in every sphere of our activity we are happy to be in the competition. We are looking for a fair and open competition that the [Gambling Commission] has initiated, we are very much in the game, we are in the final stages of creating a strong consortium of credible partners, the details of which will be shared in due course.”

3. On 27 October 2020, the Gambling Commission published an “Operational Note: ITA Launch”, in which its states:

On 28 August, the Gambling Commission launched the competition to award the fourth National Lottery licence. The launch was marked by the issuing of the Selection Questionnaire (SQ) to potential applicants.

The deadline for completion of the questionnaire was 2 October and we are encouraged by the number of applications received.

The Invitation to Apply (ITA) was issued to all applicants who successfully passed the SQ stage on 26 October.

This means that the competition has entered the ‘award stage’ and interested parties can begin preparing their detailed applications. They will have until July 2021 to complete their applications and we look forward to assessing these proposals as part of a competitive process.

4. On 20 November 2020, the House of Commons Library published a Briefing Paper entitled “The National Lottery – How does it work?”, that you can download below.

5. Launching its review of the Gambling Act 2005 on 8 December 2020, the UK Government announced that, as widely expected, the minimum age for playing the National Lottery will be raised from 16 to 18 from no later than October 2021. In its accompanying press release, the Government stated:

It has also been announced today that the minimum age for playing the National Lottery will be raised from 16 to 18 from October 2021.

Secretary of State for Digital, Culture, Media and Sport, Oliver Dowden, said:

“Whilst millions gamble responsibly, the Gambling Act is an analogue law in a digital age. From an era of having a flutter in a high street bookmaker, casino, racecourse or seaside pier, the industry has evolved at breakneck speed.

This comprehensive review will ensure we are tackling problem gambling in all its forms to protect children and vulnerable people. It will also help those who enjoy placing a bet to do so safely.

This builds upon our clear track record of introducing tough measures to protect people from the risk of gambling harm – banning the use of credit cards, launching tighter age verification checks and cutting the maximum stake on fixed odds betting terminals.”

Minister for Sport, Tourism and Heritage Nigel Huddleston said:

“We’re committed to protecting young people from gambling related harm which is why we are raising the minimum age for the National Lottery. Patterns of play have changed since its inception, with a shift towards online games, and this change will help make sure the National Lottery, although already low-risk, is not a gateway to problem gambling.”

6. On the same day (8 December 2020), the present National Lottery operator, Camelot, issued the following statement on the Government announcement on The National Lottery age of play:

A Camelot spokesperson said:

“We’ve said all along that we would fully support any decision made by the government to raise the minimum age to play. Now that a decision has been made to raise the age to 18 by October 2021, we’ll be doing everything we can to implement all of the changes that will be necessary as quickly as possible, while ensuring that we maintain the very high standards demanded of The National Lottery. We’ve already started this work in preparation and, subject to receiving the appropriate licence variations and waivers from the Gambling Commission, we’re aiming to complete all of the changes that are needed in our online channels by early April 2021 and, in our retail channel, over the course of the summer – well in advance of the change in law.”

For background:

The National Lottery is a vast and complex operation, with a network of 44,000 independently owned retailers across the UK and more than 8.5 million active registered players, making it Europe’s largest online lottery in terms of sales. With our operating licence requiring us to ensure that the minimum age to play appears on all physical materials, as well as in all online channels, the changeover will not happen overnight. This isn’t simply a case of sending new stickers to retailers or flicking an online switch.

In retail, for example, around 80 individual items need changing or removing – including fixed signage, permanent point of sale equipment, physical tickets and Scratchcards, and play slips. And online, more than 50 separate areas need addressing – including Games Rules and Procedures, online Player Guides, app alerts and notifications, and automated emails. On top of that, any COVID-19 restrictions will need to be taken into account to ensure that we implement the changes as safely and responsibly as possible.

7. On 27 January 2021, it was announced that the Gambling Commission has agreed to extend the timeline for Phase 1 of the competition for the fourth UK National Lottery Licence until 16 April 2021. The announcement states as follows:

The Gambling Commission has agreed to extend the timeline for Phase 1 of the competition by eight weeks, to provide additional time for applicants to complete their applications and for the Commission to feedback.

These changes account for the impact of the higher-than-expected number of games submitted through the ‘applicant game feedback’ process, and contribute to a fair, open and robust competition by providing applicants with sufficient time to assimilate the Commission’s feedback prior to Phase 1 applications being submitted.

The Commission also considered the challenges posed by the Covid-19 global pandemic, and the representations made by applicants on the impact of restrictions in both the UK, and other countries, on the preparation of their applications.

All dates are indicative and may evolve in line with market feedback and the continued national, and international, impact of Covid-19, all of which we are keeping under constant review.

The submission deadline for Phase 1 ITA responses is now 16 April 2021.

8. On 12 April 2021, SBC News Network’s Lottery Daily on 12 April 2021 (a copy of which you can download below) reported that, with the 16 April 2021 deadline looming, it appears there may be four participants in the competition for the fourth UK National Lottery Licence, namely:

  • Camelot
  • Sazka
  • Sugal & Damani
  • Sisal

9. As reported on 12 July 2021 by SBC News (downloadable below), on 10 July 2021 in an article entitled “Four-way tussle for National Lottery as Indian bidder drops out”, The Telegraph reported that “Indian lottery firm Sugal & Damani is poised to drop out of what is one of the most fiercely contested auctions to run the National Lottery”, adding that:

“…. four companies will remain in the running if Sugal & Damani pulls out. They include Camelot, which has run the National Lottery since its inception. It is being challenged by Italian operator Sisal. which is bidding in conjunction with children’s charity Barnardo’s; Sazka Group, owned by Czech billionaire Karek Komarek; and former adult magazine publisher Richard Desmond.”

10. On 26 July 2021, the House of Commons DCMS Committee commenced a “What next for the National Lottery?” Inquiry to examine the 4NLC process and scrutinise the preferred applicant. As confirmed in our separate website report, the DCMS Committee has issued a Call for Evidence, inviting written submissions by no later than Friday 10 September 2021.

11. On 4 August 2021, the Gambling Commission announced that, following representations from applicants and experience from Phase One of the fourth National Lottery Competition:

  • the timeline for Phase Two has been further extended (by four weeks for the application stage and six weeks for the evaluation stage) and
  • the third National Lottery licence (held by Camelot) will be extended by six months, with the consequence that the fourth National Licence will begin in February 2024.

12. On 19 August 2021, an FT article entitled “Gambling regulator accused of interfering in lottery inquiry” carrying the following sub-heading “Head of UK parliamentary committee warns watchdog it overstepped the mark in asking to delay its evidence” reported Julian Knight MP (Chair of the Commons Digital, Culture, Media and Sport committee”) had described as “unprecedented” and “potentially a contempt of parliament” a warning within a letter from the Gambling Commission’s CEO, Andrew Rhodes, that the “What next for the National Lottery?” Inquiry:

“…. would pose significant risk to the integrity of the competition if the Gambling Commission, any of the applicants, or anyone directly involved in the competition in any way, were to provide evidence to the inquiry at this sensitive stage of the competition …. for these reasons, I believe that the public interest would be best served by contributing to your inquiry at a later stage and my colleagues and I will, of course, be very happy to give detailed evidence to the committee once the competition has concluded”.

13. On 10 September 2021, the House of Commons Library published an updated Research Briefing Paper entitled “The National Lottery – How does it work?”, that you can download below.

14. On 16 September 2021, we reported here on an interesting exchange of correspondence regarding the National Lottery between Carolyn Harris MP (the Chair of the Gambling Related Harm APPG) and Andrew Rhodes (the Interim Chief Executive of the Gambling Commission).

15. On 19 October 2021, the Gambling Commission announced that it had received four final applications for the Fourth National Lottery licence competition, as reported by us here.

16. On 11 November 2021, a summary report – accessible here – was published by the Department for Digital, Culture, Media & Sport, setting out the findings and recommendations of an independent inquiry that it had commissioned on the National Lottery Community Fund.

17. On 10 February 2022, the Gambling Commission published on its website the following notice shortly following publication by the Daily Telegraph of an article entitled ‘Camelot hits the National Lottery jackpot again’:

Fourth National Lottery Licence Competition: Response to media article

In response to an inaccurate article published on the Daily Telegraph website and in today’s newspaper (10 February 2022), the Gambling Commission said:

“Our job is to run the best competition we possibly can – one that is fair and open, and results in the best outcome for players and good causes.

“The Board of Commissioners make the final decision and will inform the Government when the final decision is made.

“We are still in the process of evaluation and today’s Daily Telegraph piece is simply based on false and inaccurate information. We have asked them to remove the article in its current form from the newspaper’s website.”

18. On 15 March 2022, the Gambling Commission named Allwyn Entertainment Ltd (formerly Sazka Group UK 2 Ltd) as the ‘Preferred Applicant’ for the Fourth National Lottery licence.

19. On 20 September 2022, the Gambling Commission formally awarded the fourth National Lottery licence to Allwyn (as reported by us here).