London borough’s rejection of Paddy Power bet shop application could set precedent

paddy-power-london-betting-shopAnti-gambling campaigners in the UK believe they may have discovered a legal method of revoking the licenses of hundreds of betting shops across the country. Late last week, the Newham Council in London rejected an application by Irish bookies Paddy Power to open a new betting shop in the borough because the Council believed the shop would derive more revenue from its fixed-odds betting terminals (FOBTs) than its over-the-counter (OTC) betting business. If upheld, the Council’s decision could provide a legal justification for other jurisdictions to reject new applications or even revoke existing ones.

According to the 2005 Gambling Act, ‘traditional’ betting must be the primary activity of a betting shop. Councillor Ian Corbett told the Financial Mail on Sunday that he and the other Council members were “unconvinced that at least half” of the gambling that would take place on the new Paddy premises would fall under that ‘traditional’ betting classification. The most recent Gambling Commission stats for the 12 months ended March 31, 2012 showed betting shops’ total gross gaming yield from OTC betting at £1.447b, narrowly edging out FOBTs at £1.394b. The Association of British Bookmakers disputed the Council’s conception of what constituted primary activity, saying it “appears to be at odds with the Gambling Commission’s advice and guidance on this issue.”

Corbett claimed the Council was also concerned about “the high proportion of incidents of crime and disorder” in the area. An unidentified source said the Council had “mapped out where crimes and disorder take place and compared that with where the betting shops are – and it lit up like a Christmas tree.” A Paddy spokeswoman rejected this claim, saying the company’s shops were “occasionally the victims of crime, but not the cause.” Paddy intends to appeal the Council’s decision.