The United Kingdom has a long history of legally sanctioned gambling
going back centuries. It was the pastime of royalty in the middle ages, and there are “gentlemen's clubs” in London that can date their history back literally hundreds of years.
So while gambling is at times frowned upon and condemned, it has never been actively discriminated against in law other than to restrict its practise to licensed venues. The United Kingdom has chosen to regulate and tax the gaming industry from the outset. One of the earliest relevant laws dates back to 1689 which bans all lotteries
– unless they are authorised.
This culture of licensing has resulted in a social acceptance of betting games, and a significant revenue stream for the government in the form of levies and license fees, and is currently a £63 billion pound industry.
Gambling legislation in the UK had largely been fixed in the 1960s, and there had been no significant reason to alter the laws until the advent of the World Wide Web. When casinos began to appear online, Britons flocked to them.
Government response to this new phenomenon was slow, but when the realisation arrived that their laws needed review, they developed one of the most comprehensive sets of online betting regulations in the world.
Plans to create new gambling regulations
began as early as 2001. The Bill arrived at draft status in 2003, and in 2005 the Gambling Bill was passed into British law.
The Gambling Bill effectively embraces online gambling, classing it as “remote gambling” along with other off-site play such as phone-in betting or gambling over interactive satellite TV channels. Operators require a specific Remote Gambling License to offer online gambling, even if they're an established, licensed physical casino.
Additionally, you require a license to develop and distribute gambling software in the UK, primarily because this aspect of the industry is carefully regulated to prevent cheating.
Both operating an unlicensed online casino, or developing software for one without a license, carries an automatic penalty of six months in prison. Offenders may also be required to pay a fine.
The Bill contains a number of clauses designed to prevent under-age players from gambling, and interestingly also prohibits “vulnerable adults” from participating. If a child is discovered to be playing at your online casino, you may not pay out any winnings to them. You are also required to return to them any money they may have paid to you. This is obviously in cases of accidental infringement, but it is a specific offence to invite under-age players to gamble.
The Gambling Bill created a new body called the Gambling Commission whose task it is to issue licenses and monitor online casinos for compliance with the law. The Commission is also required to monitor the issue of gambling addiction, and the UK gambling industry is required to pay £3 million a year towards research into addiction and the development of methodologies to combat it.
When the Bill was introduced, Secretary of State for Culture, Media and Sport Tessa Jowell explained that the Bill in fact does not change much about what is allowed, but rather introduces safeguards for players in an age of new online gaming.