A major win for betting shops? Anti-clustering laws ruled illegal

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Permalink Reply by Clive Carter on February 16, 2012 at 12:55

Thanks for posting this Bushy (do you have a link, please?)

I couldn't agree more that, regrettably, this is indeed a major (and predictable) win for betting shops.

I have always maintained that the planning-based approach was doomed to fail. Yet the local council, along with other councils, has persisted with this approach against all logic, reason and evidence.

If it hadn't been an EU ruling, it could just have easily have been, or will be, a UK Court ruling.

I am not a lawyer, but you don't have to be QC barrister or need to examine past court rulings too closely, to understand that the Gambling Act (2005) trumps all other relevant legislation. Licensing authorities like Haringey are mandated to "aim to permit" new gambling premises legislation.

There is one beneficial thing about this ruling. It should now be clear to all interested parties that clustering/planning is at best a busted flush, that the time spent pursuing this has been wasted and it is now time to pursue another approach.

The only approach that can possibly be effective in curbing the clustering and proliferation of betting shops, is deep reform of this reprehensible Act.

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Permalink Reply by Stuart on February 16, 2012 at 14:07

Clive

In case it's not clear, the EU ruling means that no legislation will be allowed to prevent clustering. Reform of the Gambling Act will make no difference. The reason is anti-trust or competition law. As gambling is a legitimate activity (whether we like it or not), anti-trust laws (which are designed to stop monopolies, cartels and market abuse) prevent protection being given to existing businesses to the detriment of competitors in the market. Assuming you believe in a free market, these laws are a good thing, even if they end up protecting those businesses whose activities we don't like. There are exceptions when EU countries can side-step them but I suspect unlikely to apply. Don't get me started, we'll be here all day!

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Permalink Reply by Clive Carter on February 16, 2012 at 14:24

Reform of the Gambling Act will make no difference.

Bushy I think you overlook that gambling is a licenced activity. Unlike other forms of commerce, a new premises for the purposes of gambling, requires a Gambling Premises Licence.

The last major statute to bear on this, the Gambling Act of 2005, dramatically changed the criteria for licensing. Local authorities like Haringey must now, "aim to permit" (gambling premises licence applications).

And thus, what was formerly controlled via licensing, has become controlled via a near-automatic rubber-stamp. Licensing has become a mere formality, largely meaningless.

The Act was a triumph of lobbying.

Moreover, the Act largely achieved another of its main purposes, which was to persuade some casual observers to accept that betting shops, and all that happens in them, is simply another form of retail activity and ought to be subject to the same free market forces of supply and demand as affects greengrocers.

Licensing legislation, for good or ill, trumps Planning legislation, Appeals by the council and the will of communities.

The present situation has arisen as a direct result of the permissions of the Gambling Act. Reform of that Act will make all the difference.

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Permalink Reply by Germana on February 16, 2012 at 14:40

Quoting from the press release of the European Court of Justice, 

"a national system which requires minimum distances between outlets would be justifiable only if it did not have as its true objective the protection of the market position of the existing operators, a matter for the national court to determine."

I think Clive is right - it's the national legislation one has to worry about in the first place...

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Permalink Reply by David Schmitz on February 16, 2012 at 14:51

You may wish to look at the press release from the ECJ which can be accessed at http://curia.europa.eu/jcms/upload/docs/application/pdf/2012-02/cp1... 

From this it would appear that the decision is confined to rather special circumstances. What happened in that case was that some years ago licences to operate these establishments had been given in substantial but nonetheless restricted numbers to persons who tendered for them. There were, however, rules which limited the types of propreitor who would be allowed to tender, and these rules were eventually held to be unlawful by the ECJ in 2007. The Italian government accordingly came up with a new tendering process which did not impose these restrictions on those who were eligible to tender, but they also imposed a requirement, applicable aparrently in all cases, defining a minimum distance which there must be between any two establishments. 

The ECJ in a preliminary ruling has advised that to create such a universal rule is to discriminate against new entrants only, and that it is unlawful to discriminate against such entrants if the only reason why they are new is that they were unlawfully discriminated against in the past.

In England there has been no such past discrimination and there is no set rule limiting distances. A policy to keep the numbers down would not infringe EU competition law, therefore, if it were imposed solely for reasons of general public benefit. The legitimacy of doing that is recognised in the decision itself. The problem with the Italian practice was that it went over the borderline between benefiting the public and keeping things cosy for the existing businesses at the expense of newcomers.

A campaign to limit numbers of betting shops in London therefore seems to me to be perfectly justified and justifiable under EU law.

David Schmitz

Liberal Democrat Councillor for Harringay Ward

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Permalink Reply by Clive Carter on February 16, 2012 at 16:17

I think that underlying any views of the control of betting shops, are one of two schools of thought about their nature and particularly how they compare with other forms of High Street commerce where, by and large, market forces are allowed to play out:

EITHER

betting shops are genuinely comparable with regular retail and are a benign activity, in which case they do not need Licensing, in the same way that greengrocers are not licensed; or (as we currently have) need licensing in little more than name only and which is toothless;

OR

betting shops are qualitatively different from other High Street commerce and feature significantly addictive, obsessive-compulsive aspects, in which case they do need Licensing and moreover, Licensing that is effective.

This, it seems to me, is the heart of the question.

It also seems to me that the Gambling Act comes down on the first side of the first proposition (I would cite the covering guidance to the Act). The fig leaf of Licensing is still there, for the sake of decency and fooling the gullible (possibly including the MPs who passed the Act in the first place).

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