The UK Gambling Commission released a new position paper on in-play betting that clarifies that it does not see any need to change the current regulations allowing that type of wagering.
The “In-play (in-running) betting: position paper” is available here.
In-play betting is being banned in some countries, Australia is an example, because it may present some increased risks of problem gambling; may be exploitable using advanced technology; and may be exploited as a criminal activity.
The UKGC disagrees that these risks make in-play betting inherently more risky than other forms of gambling and sports betting. It believes that effective risk management can control the additional risks:
“We do not consider, at this time, that in-play betting represents a significant risk to the licensing objectives over and above any other type of gambling.”
In-play sports betting raises specific concerns
The UKGC identifies three areas of concern which it has studied in order to come to its position:
- Fairness and transparency of the betting
- Integrity of the betting
- Risk of harm within the betting medium
Technology gives some bettors an advantage
The particular issue which the UKGC suggests may lead to unfairness, results from the time lag between when events occur during a sports match, and when the bettor gets that information.
Even in “live streams” or “live broadcasts,” there is a perceptible time gap between the information gained by a spectator at a live match and a viewer getting the same information.
The gap may be extremely short, but in the financial world, high frequency trading operations are able to exploit the gap and front-run trades to make profits. The UKGC sees a similar potential for in-play sports betting, where some bettors can use high speed internet to receive information before both players and operators.
Using computer programs or “bots,” some bettors can then determine when the quoted odds are not correct and use this information to place bets at an advantage.
The UKGC does not see this risk as being significant, so long as bettors are informed that others using advanced technology may have an advantage, and that bettors are fully informed about operator policies on the issues involved.
Nevertheless, the UKGC plans to consult on the subject later this year:
“However, the Commission is considering whether the current information requirements sufficiently inform bettors about the potential use of software aids and operator’s policies for handling bet requests should a price change during the period between a bet request and confirmation. We will be consulting on these matters as part of the Remote gambling and Software technical standards review that will be launched in October 2016.”
Trading rooms are currently licensed
The position paper notes that it has licensed six trading rooms that offer bettors access to high-speed internet connections and faster sports feeds.
“By offering some of the shortest time delays they put bettors in the best position for betting (primarily on exchanges). These trading rooms charge bettors a fee for use of the services, and some also have commercial arrangements with betting operators and receive a percentage fee from their bettor’s activity with an operator.”
The Commission states that requiring such rooms to be licensed is “a suitable and proportionate response to the risk they pose.”
Integrity concerns focus on match fixing risks
When the UKGC talks about integrity, it generally refers to the potential for match fixing.
The possibility that match fixing may be more prevalent when in-play betting is allowed, has led the EU Parliament to recommend that member states should not allow the activity.
The UKGC recognizes that specific sports can be more vulnerable to integrity breaches by their very nature, “in particular where a single participant can affect the outcome of a bet, for example, the winner of the next set in a tennis match or the next player out in a cricket match.”
Again the UKGC rejects the idea that in-play betting significantly increases the risk.
“Despite the concerns raised about the risks to integrity from in-play betting there is limited evidence to show that the risks are greater than those associated with pre-event betting.”
It adds that existing anti-match fixing measures are sufficient:
“However, other forms of betting also have similar potential for exploitation. We do not consider that in–play betting requires further regulatory controls to those already applied within our wider efforts to maintain integrity in sports betting.”
Does in-play betting increase problem gambling?
When the UKGC last looked at in-play betting in 2009, it determined that there was “no evidence” of any increased gambling related harm compared to other types of betting or online gambling or sports betting in the UK.
Since then, further research has been carried out. The UKGC refers to the Australian study published in June 2016 which found that:
“Risk of problem gambling was also found to increase with greater frequency and expenditure on sports betting, greater diversity of gambling involvement, and with more impulsive responses to betting opportunities, including in-play live action betting.”
This is the main argument that politicians in Australia have deployed to ban in-play betting.
The UKGC then quotes its own gambling prevalence survey which “indicates that online gamblers are more likely to be classified as problem gamblers if they bet in-play, and more likely to be classified as at greater risk of harm from gambling than those who do not bet in-play.”
However, the Commission’s position is that the policies that it already requires operators to have in place should be adequate to minimizing the risk from in-play UK sports betting.
“We do not consider that someone who bets in-play is automatically at increased risk of harm from gambling, but expect that licensees will monitor all bettors for signs of risk as required by our Licence conditions and codes of practice (LCCP).”
Position paper shows how in-play betting risks can be controlled
Apart from references to further study in October, the position paper doesn’t suggest that the UKGC is likely to change its position on in-play betting — it will continue to permit its licencees to offer in-play sports betting.
However, the value of the paper is in the UKGC’s position that in-play betting can be offered safely within a regulated environment.
The UKGC does not reject in-play betting because of its risks, it has brought it into the regulated environment by accepting the risks and putting in place a method for managing them.
It is this attitude that helps to keep at-risk gamblers inside the regulated online sports betting sector, reducing incentives for bettors to seek the products they want at unregulated offshore sites.
The paper represents the UKGC’s fundamental position that consumer protection is best ensured by bringing the maximum number of players into the regulated environment.
Only in that environment, where operators are obliged to monitor and report problem gambling behavior, can real support be given to those who need it.
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