Camelot appealing unfavorable High Court ruling in UK Lottery license battle with the Gambling Commission

Current UK Lottery operator Camelot is seeking a Court of Appeal showdown with the Gambling Commission as the fight for the next National Lottery license continues. The permission to appeal was granted by the Court on Thursday. The Canadian company is challenging a High Court decision that paved the way for competitor Allwyn Entertainment to take over the lottery. 

The appeal hearing is likely to take place in the week of 12 September, according to UKGC, which on Thursday stated: "We are, obviously, disappointed with this outcome, but respect the court’s decision." Camelot suggests the regulator’s assessors flagged “implausible” revenue forecasts at Allwyn, owned by Czech billionaire Karel Komarek, which earlier this year was named as the preferred applicant to run the lottery from 2024 onwards. The current operator claims it would have been appointed had the commission not made a “manifest error."

In late June, the UK High Court agreed to lift the automatic suspension on the regulator's ability to formally award the National Lottery licence to Allwyn amid the legal proceedings submited by Camelot against the competition process. This lift had been requested by UKGC in May. 

The National Lottery has been operated by Camelot for the last 28 years. A Court of Appeal hearing will now determine whether its challenge can proceed. A separate trial is also set to proceed between the parties which will consider Camelot’s claim for damages, which could cost the government around £600 million ($700 million). 

The decision to appeal the High Court ruling comes shortly after former gambling minister Chris Philp told a Parliamentary committee he was “very disappointed” that Camelot was pursuing the litigation.

Camelot launched its High Court challenge against the UKGC in April, accusing the regulator on the grounds of breaking the law when it allegedly discarded Camelot’s score in the system that measures the bids. The UKGC said it would begin the process of formally awarding the license to Allwyn and ensure a 'seamless and timely transition' to the next license.

"We will now be preparing for trial of the various claims. We remain resolute that we have run a fair and robust competition, and that our evaluation has been carried out fairly and lawfully in accordance with our statutory duties", the UK watchdog stated at the time.

"We have 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 maximises support for good causes and its contribution to society through further innovation and investment," the UKGC defended its decision.

Camelot reported in June a year-on-year decrease in annual sales, partly attributed to the cost of living crisis that has affected consumers’ disposable income. The company announced it generated £8.1 billion ($9.9 billion) in sales in the year to March 31, down 3.4% from 2021’s record of £8.3 billion ($10 billion). 

The business attributed the drop in sales performance to a 6.6% decrease in sales of online instant games. Additionally, the annual inflation rate in the UK increased to 7% in March 2022, the highest since March 1992, from 6.2% in February.