Quiz TV

The Gambling Act 2005 was fully implemented on 1 September this year. It repeals the old laws relating to betting, gaming and lotteries and replaces them with a new licensing regime which is designed to foster safe gambling under the supervision of the Gambling Commission. But prize competitions remain unregulated under the new Act, at least so long as they do not amount to gambling.

Many broadcast programmes include competitions for prizes in which viewers can participate by means of a premium rate service (PRS) phone line. Although success in these competitions is often based on skill, many schemes inevitably involve a computerised draw whereby participants who go through to the studio are selected at random. This has often caused concerns in the past that the schemes might be illegal lotteries under the old law.

In the run-up to the new Act, the Government explicitly recognised that programmes of this kind are an important source of revenue for the media sector, that they are not to be considered as a form of gambling and that one of the benefits of changing the prize competition laws in the new Act is to promote a sustainable prize competition industry.

The new Act was designed to achieve this by clarifying the circumstances in which a scheme would be treated as a lottery. In particular, if the prizes are allocated by a series of processes and the first process relies wholly on chance, it will be a lottery. If on the other hand it involves sufficient skill, the subsequent processes (such as the draw) may now rely on chance. But the skill required in the first process must be sufficient to meet a new statutory test. The level of difficulty is likely to have to be higher than in the past. Alternatively the scheme can avoid being a lottery by providing a free entry route but again it will have to be designed to meet a new statutory test.

Some uncertainties remain, however, particularly in relation to the free entry route where it is not clear from the wording of the new Act whether or in what circumstances web access can amount to a free entry route. The Gambling Commission is currently considering this and is expected to say something publicly soon.

Taking a licence from the Gambling Commission is unlikely to be an attractive alternative. In principle, lotteries conducted for good causes and not for private gain are licensable under the Act, within certain financial limits. But the detailed requirements that would be imposed by a gambling licence are just not designed for the television industry and the Commission does not have any discretion in some crucial respects, such as ticketing, to mould the rules to its needs.

Programmes which include prize competitions accessed by PRS lines are, of course, already subject to detailed regulation by ICSTIS and Ofcom. Regulatory controls are likely to increase following recent events, including the recent publication of the Ayre Report and Ofcom's proposals for the regulation of participation TV generally. The closing date for that consultation is 17 October this year. Our lawyers can help you with any submissions you wish to make to Ofcom in response or any concerns that you may have about the new regime as well as helping you to ensure that your programme does not fall foul of the new Act..

Contact Tony Ballard on 020 7667 5000 for further details.