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High Court concludes suspension ought to be lifted in National Lottery challenge

The High Court recently delivered a preliminary judgment in linked claims concerning the lawfulness of the recently completed competition for the licence to operate the National Lottery from 2024 onwards. Helen Davies QC and Malcom Birdling assess the implications.

In the judgment, delivered on 26th June 2022, the Court (Mrs Justice O’Farrell sitting in the Technology and Construction Court) decided that the Gambling Commission ought to be permitted to enter into an “enabling agreement” with the successful tenderer (Allwyn Entertainment Ltd) and, in due course, issue it with what is the fourth national licence to operate the lottery.

The decision follows the Gambling Commission’s announcement earlier this year that, following a lengthy bidding process, Allwyn was its preferred candidate to operate the National Lottery under the terms of the fourth national lottery licence. The National Lottery was launched in 1994 to raise funds to support good causes across the UK (to whom the net proceeds of the lottery are distributed) and offer prizes to participants. It was established under The National Lottery etc. Act 1993 and is regulated by the Gambling Commission.

Following this announcement, the incumbent operator (Camelot), supported by one if its key subcontractors (IGT) brought proceedings challenging the award of the licence to Allwyn. This triggered an automatic suspension on the procurement process under the Concession Contracts Regulations 2016, with the effect that the Gambling Commission was prevented from entering into the necessary agreements with Allwyn to commence the transition towards the Fourth Licence.

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The Gambling Commission (supported by Allwyn) applied to the Court to lift the automatic suspension which, following an expedited hearing held over two days in May, resulted in today’s decision. In concluding that the suspension ought to be lifted, O’Farrell J noted that the public interest was a strong factor in favour of doing so.

This followed from the Judge’s finding that maintaining the suspension until resolution of the dispute would cause delay to the full commencement of the Fourth Licence which would, in turn, cause delay to the benefits of the Fourth Licence, giving rise to (amongst other things) reduced contributions to good causes. Balanced against the commercial losses that might be suffered by Camelot and IGT, for which the Judge concluded damages would be an adequate remedy, the Court held that allowing the Gambling Commission and Allwyn to proceed now with the Fourth Licence is the course that will produce the least risk of injustice if ultimately it proves to be wrong.

The judgment can be found here.

Helen Davies QC and Malcom Birdling are barristers at Brick Court Chambers

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