REPORT TITLE:
LARGE CASINO REGULATIONS 2008
EXECUTIVE MEMBER FOR REGENERATION & ECONOMIC DEVELOPMENT
DIRECTOR OF REGENERATION
Date 6th November 2008
PURPOSE OF THE REPORT
1. The purpose of the report is to brief the Executive on the process that will be required in relation to the licensing of the large casino in Middlesbrough.
BACKGROUND AND EXTERNAL CONSULTATION
Background
2. The Gambling Act came fully into effect on 1 September 2007. The Act contains three licensing objectives whichobjectives, which underpin the functions that local authorities perform in relation to gambling. These objectives are central to the new regulatory regime which was created by the Act and are listed below:
· preventing gambling from being a source of crime and disorder, being associated with crime and disorder, or being used to support crime;
· ensuring gambling is conducted in a fair and open way; and
· protecting children and other vulnerable persons from being harmed or exploited by gambling.
3. The Gambling Act included a provision to set up three new types of casino within the UK, which are listed below. The proposals anticipated casinos on a larger scale than any existing facility in the country:
· a regional casino offering a minimum customer area of 5000 sq.metres and up to 1250 (category A) jackpot machines with unlimited jackpots;
· 8 large casinos with a minimum gaming area of 1,500 sq.metres up to a maximum of 3,500 sq metres accommodatingmetres accommodating up to 150 gaming machines, with a maximum jackpot of £4000; and
· 8 Small casinos with a minimum gaming area of 750 sq.metres up to a maximum of 1,500 sq metres accommodating upaccommodating up to 80 gaming machines, with a maximum jackpot of £4000.
4. The Government anticipated that all categories of casino would lead to wider regeneration of the areas where premises were to be situated, because they would be entertainment destinations, rather than purely casinos.
5. The Department for Culture, Media and Sport (DCMS), set up the Casino Advisory Panel (CAP) to recommend to the Secretary of State, the areas where the casinos would be best located. The primary criterion laid down by the DCMS was:
· to ensure that locations satisfy the need for the best possible test of social impact (which may require a range of locations of different kinds such as seaside resorts, edge of town developments, or inner cities).
6. CAP invited bids from Local Authorities around the UK, which were interested in becoming a location for one of the categories of casinos.
7. Middlesbrough Council put forward a bid in March 2006 to try and secure a regional casino, with Middlehaven submitted as the preferred location for the facility. In addition an application for a large casino licence was also submitted.
8. CAP announced its recommendations to the DCMS in January 2007 and Middlesbrough was not successful with the regional casino bid, but was recommended as a location for a large casino.
9. The Government took forward the CAP recommendations and brought before Parliament a draft order to approve them in full. The original order was laid in Parliament on 1st March 2007 and debated in both Houses. A motion approving the order was passed by the House of Commons, but was defeated by the House of Lords. Opposition centred on two issues:
· opposition to the scale of gambling offerings that the new casinos and in particular the regional casino could make available; and
· opposition to the authorisation of Manchester City Council to license the sole Regional casino at the expense of Blackpool.
10. The Secretary of State for Culture, Media and Sport, subsequently decided to take time to reflect on the Government’s policy in relation to casinos, but noted that the House of Lords objections had been centred on the regional casino and not the large and small casinos.
11. In March 2008, the Secretary of State decided to lay before Parliament a draft Order, which would make provision for the licensing of large and small casinos by those authorities identified by CAP and named in the original draft Order.
12. The new draft Order was passed by both Houses of Parliament in May 2008, permitting Middlesbrough Council to license a large casino within the town.
Licensing Process
13. The DCMS has now issued a Code of Practice outlining how authorities should set about determining the issuing of a licence, under the Gambling Act 2005.
14. The DCMS Code of Practice states that the decision regarding the determination of application should be made by the Licensing Authority, i.e. the Licensing Committee, and not the Executive or full Council.
15. The Code of Practice further states that the Licensing Authority:
· follows a two stage process in order to reach its decision;
· ensures that any pre-existing contract, arrangement or other relationship it has with any person does not affect the procedure so as to make it unfair to any applicant; and
· prepares a register of interests disclosing its interest in any contract, arrangement or other relationship with an applicant, or a person connected or associated with an applicant.
16. Each Licensing Authority should set out the guidelines and principles that it will use to determine how it will award a large casino licence, both within its Licensing Policy and within an application pack that will be made available to all applicants.
17. The Code of Practice stipulates that a two stagetwo-stage process must be followed in order for a Licensing Authority to issue a large casino licence. The guidance stipulates the following for stage one of the procedure:
· the Licensing Authority must apply the procedure for assessing applications for premises licences, which they ordinarily apply to applications under the Gambling Act. The only exception is that all applicants become an interested party and therefore can comment upon, and object to, other applicants;
· the Licensing Authority must only consider the impact of the application on the licensing objectives as in the usual determination of application under the Gambling Act. They must not take into account any matters which they would not ordinarily take into account in determining an application for a premises licence e.g., they must not compare one application with another;
· an invitation calling for applications should be placed in relevant publications both within the UK and overseas, advising of the licence opportunity; and
· an application pack, including all information relevant to potential applicants be prepared and made available to interested applicants.
18. The Licensing Authority will be required to determine the applications at stage one and it is anticipated that a number of operators will meet the eligibility criteria, which will allow them to progress to stage two of the process.
19. The Code of Practice stipulates the following for stage two of the procedure:
· applicants who have been successful at stage one should be invited to participate in the second stage;
· each applicant must be given an equal opportunity to demonstrate to the Licensing Authority how their application would, if granted, result in the greatest benefit to the authority’s area; and
· the Licensing Authority may engage in discussions or negotiations during the second stage with each applicanteach applicant with a view to the particulars of an application being refined, supplemented or otherwise altered so as to maximise the benefits to the area that would result from it, if granted.
20. The Licensing Authority will assess the applications according to the principles set down by the Authority in order to determine which application will result in the greatest benefit to the area. .ItIt is anticipated that stage one of the process will approve the casino operators which meet the legal requirements to run such a facility, whilst stage two will identify the wider benefits the operators may provide in the development of such a facility.
Officer Project Group
21. An internal group of Council Officers from Economic Regeneration, Licensing, Urban Policy and Implementation, Legal Services, and Strategic Procurement has been set up to assist the process of setting up a competition based upon the guidelines provided by the DCMS.
22. Representatives from the internal group highlighted in paragraph 21, are also involved in a group of officers from the other authorities that have been granted the provision to issue licences for large and small casinos, which has been set up via the Local Government Association (LGA). This group discusses matters relevant to all authorities in this process. In addition, the group has secured Counsel support regarding legal issues emanating from the process.
Next Steps
23. Middlesbrough Council is required to revise its Statement of Principles in relation to the Gambling Act to reflect the new guidance and code of practice, in particular the principles to be applied in determining applications, including the greatest benefit criteria.
24. The outline process for revising the Policy is set out below. It is anticipated that this process will take 6-8 months:
· produce draft version for consultation;
· approval of consultation document through CMT and Executive;
· Licensing Committee update;
· consultation period;
· approval of revised Policy / amendment of Policy in line with consultation responses;
· approval of Policy by full Council.
FINANCIAL, LEGAL AND WARD IMPLICATIONS
Financial
25. The Secretary of State has set national maximum limits for fees the administration of the Gambling Act. It is proposed that Middlesbrough Council set its casino application fees at the maximum, in order to cover the anticipated cost of the administration of the selection process.
26. At this stage there are no other financial implications, however, development of the Council’s greatest benefit proposals may alter this.
Ward Implications
27. Planning guidance via the Local Development Framework stipulates that any casino will be based within the town centre, but potential benefits would accrue across the town.
Legal Implications
28. The administration of casino provisions of the Gambling Act 2005 are governed by national guidance, regulations and codes of practice. All decisions in relation to determining applications will be made through the Licensing Committee.
RECOMMENDATIONS
29. It is recommended that Executive notesnote the current position of the Authority in relation to the administration of the casino application and development process.
30. That a further report on the detailed competition process be provided in due course.
REASONS
31. The report sets out the Council’s current position in regard to the matter.
BACKGROUND PAPERS
The following background papers were used in the preparation of this report:
Gambling Act 2005
Gambling Commission - Guidance to Local Authorities, 2nd Edition, June 2007
The Gambling (Inviting Competing Applications for Large and Small Casino Premises Licences)
Regulations 2008 (SI No.469 of 2008)
Gambling Commission - Code of Practice - relating to Large and Small Casinos, February 2008
AUTHOR: Richard Dowson/Judith Hedgley
TEL NO: 01642 729560/01642 728205
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Address: Website: http://www.middlesbrough.gov.uk
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