Camelot starts high court action after losing UK Lottery license competition; UKGC "regrets" decision

UK National Lottery operator Camelot is launching a high court challenge against the UK Gambling Commission after it decided to hand over the operation of the lottery to rival Allwyn after 28 years, accusing the regulator on the grounds of breaking the law when it discarded Camelot’s score in the system that measures the bids.

Camelot’s Chief Executive Nigel Railton said in an official statement published Friday that the legal challenge launched in the Group’s capacity as an applicant for the fourth national lottery license comes as “we firmly believe that the Gambling Commission has got this decision badly wrong”. 

"Despite lengthy correspondence, the Commission has failed to provide a satisfactory response. We are therefore left with no choice but to ask the court to establish what happened. Irrespective of Camelot's dual roles as current operator and applicant for the next National Lottery licence, the competition is one of the largest UK government-sponsored procurements and the process deserves independent scrutiny. Separately, more than 1,000 Camelot employees work tirelessly to successfully operate The National Lottery under the current licence and, at the very least, they are owed a proper explanation”, Railton concluded.

According to a report by The Telegraph, Camelot had a 15% “risk factor” discount that was supposed to be applied to bidders’ financial forecasts. Camelot is expected to claim that the discount was initially applied by the regulator, but later changed to zero in the final adjudication, the prestigious UK newspaper reports.

The change in rules turned Allwyn’s projections for good causes to be higher than Camelot’s, allowing Czech billionaire and Allwyn’s boss, Karel Komarek, to get the license, but a legal battle would prevent Allwyn from signing the contract to run the National Lottery.

“We regret Camelot’s decision to bring legal proceedings following the outcome of a highly successful competition for the fourth National Lottery licence. The competition and our evaluation have been carried out fairly and lawfully in accordance with our statutory duties, and we are confident that a court would come to that conclusion”, the UKGC expressed in an official statement.

The Gambling Commission added that it is confident to have run “a fair and robust competition”, and assured it has taken “every step possible to ensure a level playing field for all interested parties, to enable us to appoint a licensee who will engage and protect players, run the National Lottery with integrity and ensure the National Lottery continues to support good causes and their contribution to society”. 

“These proceedings will not help that but we trust that Camelot will honour its obligations as the current licensee to cooperate in that transition, and we will continue to use the tools available to us to facilitate that process”, the regulator concluded.

Allwyn, owned by the Czech group Sazka, will take over from Camelot in 2024 after becoming the regulator-chosen Preferred Applicant, beating Sisal, owned by the Paddy Power parent, Flutter, and the media tycoon Richard Desmond.