England is now subject to National lockdown: Stay at Home restrictions. You must stay at home.
England is now subject to National lockdown: Stay at Home restrictions. You must stay at home.
A general guide to the law and requirements for obtaining a society lottery registration.Zoe Gofton 023 9268 8367 firstname.lastname@example.org
The law on lotteries is complex and not straightforward. This page is intended to provide help and guidance to societies wishing to promote lotteries. It also tells you what other types of lotteries can be conducted without breaking the law.
This guide takes into account changes in the law which came into effect on 1 September 2007 under the Gambling Act 2005 (“the Act”).
We have tried to explain this legislation plainly and clearly. We may not cover every individual aspect of lottery law and you should still consult the Act and associated regulations mentioned and take professional or legal advice if appropriate.
Pages within this section will tell you:
We will be asking you to complete an application form in order that we can process your application quickly. All information received will be treated with respect and in confidence.
Please read this page carefully. Feel free to ask (or phone) for advice at any time.
The Act of Parliament controlling lotteries is the Gambling Act 2005. The Act introduces a new regulator for all gambling (except the National Lottery and spread betting) in Great Britain, the Gambling Commission. It also introduces a new licensing regime for society and local authority lotteries and a registration system for small society lotteries.
The Act creates two broad classes of lottery:
The Gambling Commission does not regulate the National Lottery, this continues to be regulated by the National Lottery Commission under separate legislation.
An arrangement is a simple lottery if:
An arrangement is a complex lottery if:
Note: By virtue of section 14(5) of the Act, for the purpose of these definitions, a process which requires persons to exercise skill or judgement or display knowledge is to be treated as relying wholly on chance if:
There are basically three types of lottery that can be promoted under the Act. These are as follows:
These are lotteries promoted for the benefit of a non-commercial society. A society is non-commercial if it is established and conducted:
A licence is needed from the Gambling Commission.
A local authority may use the net proceeds of its lottery for any purpose for which it has power to incur expenditure. A licence is needed from the Gambling Commission.
Exempt lotteries do not require a licence from the Gambling Commission, although small society lotteries are required to register with their local authority. In addition to small society lotteries, exempt lotteries include:
If the total proceeds (ticket sales) for a society lottery exceed £20,000 or if the proceeds of previous lotteries in the same calendar year have already reached or may, taking into account that lottery in question, reach £250,000 in one calendar year then the lottery is a large lottery and may only be run under a lottery operating licence issued by the Gambling Commission. Further information about obtaining such licences can be found on the Gambling Commission’s website
An incidental non-commercial lottery is:
Such examples may include a lottery held at a school fete or at a social event such as a dinner dance. An event may be regarded as non-commercial if all the money raised at the event, including entrance fees, goes entirely to purposes that are not for private gain. For example a fundraising social event with an entrance fee would be non-commercial if the profits went to a society but would be commercial if the profits were retained by the organiser.
The Act also specifies that:
1. the promoters of the lottery may not deduct more than £100 from the proceeds in respect of the expenses incurred in organising the lottery, such as the cost of printing tickets, hire of equipment and so on
2. not more than £500 can be spent on prizes (but other prizes may be donated to the lottery)
3. the lottery cannot involve a rollover of prizes from one lottery to another
4. all tickets must be sold at the location during the event, and the result made public while the event takes place.
NOTE: The Licensing Act 2003 permits prizes of alcohol to be offered in lotteries without the need for a premises licence under the 2003 Act.
There are three types of private lotteries that qualify as exempt lotteries which are:
The Act requires that no advertisements for the above private lotteries may be displayed or distributed except at the society or work premises or the relevant residence.
Rollovers are prohibited in private lotteries.
Whilst exempt from registration, private lotteries must comply with conditions set out in schedule 11 of the Act which relate to the price and format of tickets. In brief, the requirements are:
Private lotteries may not be conducted on vessels. The definition of a vessel (section 353(1) of the Act) is:
A customer lottery is a lottery run by the occupiers of business premises, who sell tickets only to customers present on their premises.
The Act sets out the following stipulations:
No advertisement may be:
Each ticket must state:
Customer lotteries are not permitted to be conducted on vessels as per the definition outlined above.
Societies who run small society lotteries, that is to say lotteries which are not large lotteries (essentially those in which £20,000 (or less) worth of tickets are put on sale where the society’s aggregate proceeds from lotteries do not exceed £250,000 a year) may operate without a Gambling Commission licence provided they register with their local authority.
The purpose of permitted lotteries as set out in the Act is so that societies can raise money for causes that are non-commercial and therefore the Act requires that a minimum of the money raised by the lottery is channelled to the goals of the society that promoted the lottery. If a small society lottery breaches these limits, it will be in breach of the Act and will be liable to prosecution.
The limits placed on small society lotteries are as follows:
A society must be registered with a local authority throughout the period during which the lottery is promoted. Parts 4 and 5 of Schedule 11 of the Act set out the requirements for societies and licensing authorities as regards registration of small society lotteries.
The society is required to be registered with the local authority in the area where there principal office is located. If the local authority considers that the society’s principle office is situated in another area it shall inform the society as soon as possible and also notify the other appropriate local authority.
The application must be in the form prescribed by regulations and will need to be accompanied by the prescribed fee of £40.
The licensing authority will record details of the society and keep the details on a register. Whilst this does not have to be a public register, the Gambling Commission have recommended that licensing authorities make the register available to the public on request.
Paragraphs 47 and 48 of Schedule 11 of the Act set out the grounds for refusal of registrations. In summary these are:
The Gambling Commission website will maintain details of those people who hold a lottery operating licence.
Should the licensing authority be concerned that an applicant for registration may have been refused an application for an operating licence, the Gambling Commission will be consulted for further information.
A licensing authority may only refuse an application after the society has had the opportunity to make representations. Licensing authorities will inform the society of the reasons why it is minded to refuse the registration and the evidence it relied upon to reach that preliminary conclusion. Licensing authorities have the discretion to decide how to handle representations but it is considered good practice for those procedures to be made available to applicants. The Gambling Commission is currently considering whether it can usefully provide any further guidance.
A licensing authority can revoke the registration of a society if it thinks that they would have to, or would be entitled to, refuse an application for registration if it were being made at that time. No revocations can take place unless the society has had an opportunity to make representations and consideration of what procedures shall be put into effect are as outlined in the above paragraph.
Paragraph 51 of Schedule 11 of the Act sets out the processes for appeals against refusal or revocation of small society lottery registrations. The applicant or registered society may appeal if the licensing authority has rejected an application for registration or revoked the registration.
The appeal must be made within 21 days of receipt of a notice of the decision and must be made to the local magistrates’ court.
On appeal, the magistrates’ court may take the following action:
To help us consider your society registration we would like you to show us that:
WARNING: Registration of your society depends on the location of the office of the society. ONLY SOCIETIES WHOSE OFFICE IS IN PORTSMOUTH CAN REGISTER WITH US
NB: Once registered, you may promote lotteries outside Portsmouth without the need for further registration.
Victoria Square House
Birmingham B2 4BP
Tel: 0121 230 6666
Fax: 0121 230 6720
We will notify you in writing once your society is registered for promoting lotteries. You will remain registered unless your society registration is revoked by us or cancelled by you.
Remember also that we have the power to inspect and copy any documents relating to any lottery and may also inspect and copy information that you might hold about your lotteries on computer disc.
When promoting each and every lottery you wish to hold please ensure that you abide by the following rules:
The requirements for information that the society must supply to the local authority with whom they are registered are contained within paragraph 39, Schedule 11 of the Act.
Provision of this information allows the local authority to assess whether the financial limits are being adhered to and to ensure that any money raised is applied for the proper purpose. The information to be submitted is as follows:
The return must:
The licensing authority must make the returns submitted by societies in the preceding 18 months available for inspection by the public.
External lottery managers can be an individual, firm or company appointed by the society to manage a lottery or lotteries on behalf of the society. They are consultants and generally take their fees from the expenses of the lottery.
External lottery managers must hold an operator’s licence issued by the Commission to manage any lottery including small society lotteries registered with a licensing authority.
Any society which employs an unlicensed external lottery manager commits an offence so societies will need to satisfy themselves that any external lottery manager they wish to employ is licensed by the Gambling Commission. Societies will be able to do this by looking at the register of licences held on the Gambling Commission’s website.
Lotteries may involve the issuing of physical or virtual tickets to participants. Schedule 11 of the Act requires that all tickets must:
“Ticketless” or electronic lotteries must allow the participant to retain the message electronically, or print it.
The Gambling Commission recommends that societies maintain written records of unsold and returned tickets for a period of one year. The licensing authority is permitted to inspect the records of the lottery for any purpose related to the lottery.
Once registered, the society must pay an annual fee of £20 to the registering local authority. This fee must be paid within the period of two months which ends immediately before each anniversary of the registration. If the registered society fails to pay the annual fee, the local authority may cancel the society’s registration.
WARNING: It is an offence to either fail to send a return or to knowingly provide false information in it.