UK Gambling Commission Considers Settlement National Lottery Dispute
The UK Gambling Commission (UKGC) is reportedly in discussions with media tycoon Richard Desmond over a £200m claim linked to the controversial awarding of the National Lottery’s fourth license. Talks aim to resolve the dispute through mediation in the coming weeks, avoiding a prolonged court battle.
The Licensing Controversy
The legal clash stems from the UKGC’s decision to award the National Lottery license to Czech operator Allwyn, owned by billionaire Karel Komarek. The move sidelined bids from Desmond’s Northern and Shell and Camelot, the lottery’s long-time operator. Allwyn officially took over in February 2023, but the transition has been fraught with challenges, including technical delays and operational concerns.
A significant point of contention has been Allwyn’s slow progress in upgrading the National Lottery’s IT systems. The modernization project, central to Allwyn’s license proposal, has faced repeated delays. The company initially aimed to complete the upgrades by February 2025, but insiders now suggest that further delays could push the completion timeline to summer 2025 or beyond.
These delays have raised questions about Allwyn’s ability to deliver on its ambitious promises, including doubling lottery contributions to charitable causes from £17bn to £34bn over the next decade. Falling sales and missed deadlines have cast doubt on whether these targets can be achieved.
Criticism of the Bidding Process
Desmond’s Northern and Shell has accused the UKGC of mishandling the license bidding process, arguing that Allwyn lacks the necessary UK experience to run the National Lottery effectively. In court filings, his company highlighted the operational difficulties and compared the IT challenges to “installing a Microsoft system on an Apple computer.”
The problems also trace back to an earlier dispute involving International Games Technology (IGT), Camelot’s former technology provider. IGT contested the license award and sought damages in the High Court before ultimately reaching a new technology agreement with Allwyn, a move that delayed the transition by six months.
The prolonged upgrade process has sparked criticism from industry figures and stakeholders, many of whom doubt Allwyn’s ability to manage the lottery effectively. With sales failing to meet expectations, concerns are mounting about the lottery’s operational stability and its ability to meet charitable fundraising goals.
While mediation could bring an end to the legal dispute, it remains uncertain whether Desmond’s £200m claim will be fully satisfied. A settlement, even at a reduced figure, would provide some closure to the UKGC and Allwyn, allowing them to focus on resolving the lottery’s technical and operational challenges.
