We reported in May 2020 on a Gambling Commission consultation in relation to proposed changes to its corporate governance framework that it described as being designed to “ensure that [its] Regulatory Panels are best equipped to deal with [its] evolving casework”. They included proposals to:

• introduce legally qualified Adjudicators as members of the Commission’s Regulatory Panels (that provide an opportunity for applicants/licensees to attend an oral hearing to challenge decisions that Commission staff are minded to take about personal or operators’ licences),
• deal with the late admission of evidence, arranging a hearing and representations on financial penalties, and
• to change the time limits relating to the submission of bundles, communicating decisions and the date by which financial penalties should be paid.

The proposals provoked considerable controversy, including on the ground that the independence and impartiality of the Regulatory Panels would be adversely affected, as evidenced for example by:

• the content if an article entitled “Under fire GC seeks to diminish turbulent priests” written by Scott Longley for iGamingBusiness, accessible here, and
• the fact that, as now transpires to be the case, the majority of the 22 written responses to the consultation – 9 from gambling operators, 8 from trade associations and 5 from others – disagreed with the proposals.

Disappointingly, such controversy has had very little consequence insofar as the Commission’s proposals are concerned. In its Consultation Response document (that you can download below) – stated by the regulator to have been published on 21 July 2021 but only drawn to interested parties’ specific attention in its fortnightly e-Bulletin newsletter published today (26 July 2021) – it says:

Having reviewed the consultation responses, we will

• employ between four and six Adjudicators, who are legally qualified persons employed solely for the purposes of sitting on Panels (as proposed in the consultation)
• set the quorum for conduct of any business by the Panel as a minimum of one Commissioner and one Adjudicator for matters relating to an operating licence, with a proviso that the Panel will normally comprise two Commissioners and one Adjudicator. For matters relating to a personal licence, the quorum will be one Adjudicator. This is a change in response to the consultation feedback
• enable a Panel to occasionally be asked by Commission staff to provide steers on regulatory settlement proposals / indication of an appropriate figure for a financial penalty (as proposed in the consultation)
• make changes to the procedures set out in the guidance for Regulatory Panel and Licensing hearings with reference to the timescales for the service of hearing bundles, requests to submit further evidence, the process for arranging hearing dates and the process for considering additional evidence at the hearing. We have amended proposals regarding the process of arranging hearing dates in response to consultation feedback, and have amended the guidance to show that Case Management Hearings will take place before the Adjudicator sitting alone
• in due course, publish an Adjudicator Governance Framework (“AGF”) as part of the Commission’s Corporate Governance Framework, to codify the role, training and operating framework of Adjudicators. This is as a response to consultation feedback.

Insofar as the principal proposal (i.e. to use adjudicators on regulatory panels) is concerned, the Commission sets out its position within the Consultation Response document as follows:

Impartiality

Regarding the concerns raised about the impartiality of Adjudicators, as employees of the Commission rather than Commissioners, it is the Commission’s view that the use of Adjudicators does not affect the impartiality of decision-making.

The Gambling Act 2005 (opens in new tab) specifically allows for any function of the Commission to be delegated to an employee – even the most serious actions, such as the revocation of a licence can be dealt with by members of Commission staff.

We would also note that Commissioners cannot be considered independent from the Commission; by virtue of Schedule 4 to the Gambling Act 2005, the Commissioners are the Commission. Although Commissioners are not employees, they cannot be seen as independent from the body that they govern and represent. As the Adjudicators’ sole engagement with the Commission will be in relation to Panels they will have no vested interest in the outcome of a particular case. Indeed, it may be said that they will have less interest than the Commissioners they are set to supplement, who do have a responsibility for the performance and reputation of the organisation more widely.

The legal background of the Adjudicators is a further mitigating factor; they have the training and professional responsibility to act fairly and discharge their functions properly. It will also be a contractual term that they are required to determine any matter before on the basis of the law and the evidence alone, in accordance with the procedures published by the Commission.

It is also important to recall that Panels are the final tier of the Commission’s internal decision-making processes, not an independent judicial process; the fully independent scrutiny of Panel decisions comes from the right of appeal to the First-tier Tribunal.

Role and status of Adjudicators

We note that more information has been requested to assist people in understanding the role and status of Adjudicators. Before these changes come into effect, we will publish the draft role description and AGF. The AGF includes:

• role and qualifications
• training plan
• arrangements for management and appraisal
• operating framework.

We recognise the particular concerns raised regarding the appraisal of Adjudicators. As a result, the annual appraisal of Adjudicators will be undertaken by a Commissioner. Their performance objectives will, of course, not be linked to agreement with the views of Commission officials. The performance management process for Adjudicators will be outlined further in the AGF.

Taking account of concerns regarding impartiality, we intend to take further steps to maintain a degree of separation between Adjudicators and other Commission employees. The Governance team will manage and co-ordinate the Adjudicators, and facilitate their access to other corporate services (eg IT and People Services). Adjudicators will be home-based, and will not have open access to Commission offices, reducing the possibility of incidental contact with wider Commission staff. These ways of working will also be written into the AGF.

We acknowledge that Commissioners bring a range of skills to the governance of the Commission, however when sitting on a Regulatory Panel they are required to keep their focus narrowly on the issues at hand. We anticipate Adjudicators will have practiced law in a range of settings, and will bring their own range of experience. In order to ensure Adjudicators have an understanding of the wider gambling environment they will receive the same induction training about the operation of licensed operators as Commissioners. This is stipulated in the AGF. The approach to the quorum of a Panel in all matters not involving personal licences means that the Panel will have at least one member who is a Commissioner, such that the Panel’s decision-making remains informed by the range of skills and experience Commissioners bring.

Respondents raised concerns about the procedural fairness of the Adjudicator taking over the legal advisory role in a Panel hearing. We do not agree and note that the proposed model replicates that used by other regulatory bodies; for example, the General Medical Council has in the past five years moved to a model of legally qualified Tribunal chairs and removed the legal advisor role. To ensure fairness, the AGF stipulates that in every matter before a Panel, an explanation of what the Panel/Adjudicator understands the law to be, on which they/he intends to rely, will be set out in a manner which enables the parties to challenge it and make submissions on it if they wish to do so.

The case for change

We were asked to provide further information about the current caseload.

In 2020-21 Panels were convened on four occasions, generating 1,741 pages of submissions for the Panel to consider, with a cost estimate to the Commission of £8,395 (for Panel and Governance time only – no legal costs are reflected). A further four hearings were requested by Licensees and subsequently withdrawn, resulting in the Commission incurring costs in preparation and management of 2,289 pages of submissions.

In 2019-20 Panels were convened eight times, generating 9,422 pages of submissions to the Panel, with a cost estimate to the Commission of £20,170 (for Panel and Governance time only – no legal costs are reflected). Two of the hearings were withdrawn at short notice by the Licensees resulting in the Commission incurring costs in preparation, Panel time and the management of just under 6,000 pages of submissions.

We do not consider that the number of Panels being convened reflects the totality of the burden placed on Commissioners through the work of Panels. In particular, we remain of the view that cases are becoming increasingly complex, with applicants asking the Panel to take decisions on matters of case management and procedure as well as matters of fact. In any event, the use of legally qualified Adjudicators will both better enable the Commission to deal with an increasingly legalised internal process, and will free the time of Commissioners to be spent on leading and overseeing the work of the Commission.

We were asked to provide examples of other regulators using a mixed model of decision-making. There are examples of this in health regulation (the General Medical Council, for instance), and in other regulated areas (Ofqual). However, we do note that there is no common statutory model for regulators, so decision-making processes do vary.

Insofar as the future timetable is concerned, the Commission states that “The changes to the affected documents will come into effect during 2021 to 2022 once adjudicators can be recruited. We will provide 4 weeks notice of the date of change via the Commission website, and will apply to all Regulatory and Licensing decisions/requests for escalation to Panel made after that date”.

Those “affected documents” are the Commission’s:

• Corporate Governance Framework, Appendix 6 – Delegation of licensing and regulatory decisions in respect of gambling
• Regulatory decisions: Procedures and guidance for regulatory hearings – September 2017
• Licensing decisions: Procedures and guidance for licensing hearings – September 2017

POSTSCRIPT: One cannot help recalling that, in a September 2017 Gambling Commission website posting entitled ‘Improving Communications and Consultation’, it was explained that the regulator was “listening to industry, partners, licensing authorities and consumers – and acting on their recommendations”.

The Commission’s Executive Director Tim Miller went further than that. He was quoted as saying: “Your views are very important to us. This is why, last year, we carried out a survey in which we asked stakeholders what they thought of the tools we use to communicate. As part of that two significant themes emerged – our website and the way we consult“, adding that “improving the way we communicate with everyone who has an interest in our work is a priority for us and we welcome your feedback about the way we share information. We won’t stop listening to you and continuously improving our offering”.

We are now nearly four years on from then but some readers from within the industry may think this as good a time as any to respond to the above invitation to provide feedback to the Gambling Commission on (1) its website and (2) the way it consults!