In a late media communication on Monday evening, Allwyn Entertainment sent a short press release through Brunswick, a media agency, in which it confirmed that Camelot, the UK National Lottery incumbent, has withdrawn its appeal, seeking to force the UK Gambling Commission into reviewing the fourth license tender and potentially reverse its decision.
Following the UKGC’s decision to choose Allwyn over Camelot in March, a legal battle ensued, which threatened to delay the installation of the new lottery operator, something that concerned all parties involved. Camelot, though, has agreed to drop its lawsuit and in exchange, Allwyn Entertainment will waive all claims for costs and damages against Camelot as well. This is a big break into the bottleneck that threatened to significantly harm lottery contributions to good causes.
Over the weekend, it was reported that Camelot was determined to continue with its crusade against the UK Gambling Commission which, the company accused, of having botched the fourth national tender for the National Lottery. The company alleged that the regulator has not considered specific parts of the tender process that it requested from participants in the first place.
The Observer cited by The Guardian saw court documents that reaffirmed fears from before that should this dispute drag on, good causes in the United Kingdom could have lost as much as £1bn. The exact number had been confirmed by the media if the information presented in the court filings was submitted by the UKGC.
The original dispute concerned Allwyn Entertainment, a competitor to Camelot, and whether it should have been picked to assume control over the National Lottery. According to the Commission, this was indeed the case. Camelot, though, had objected strongly and said it would pursue legal action – that was before Monday, September 5, however. There was much at stake because the contract itself is worth £6.4bn, a sizable business opportunity.
Camelot previously confirmed that if it didn’t win the contract, its UK branch would have been forced to shut down. The UKGC predicted a worst-case scenario that would have seen a delay between the launch of a new lottery operator and the expiry of the current license. UKGC wants Allwyn Entertainment to take the reins from Camelot in February 2024, and this seems to be happening now thanks to Camelot’s cooperation.
"At least £1bn" is on the line according to the regulator. Naturally, there has been a lot of pressure to settle the situation, which must have helped Camelot make the decision it did. In the build-up to Monday, Camelot insisted that it had fulfilled obligations better than any other applicant could and stressed that its contributions were slated to continue growing, with money to good causes increasing.
Should Camelot have won a stay against the transfer of license, the UK Gambling Commission would have come under a lot of fire from lawmakers, the general public, and certainly, Allwyn all asking why the regulator had not anticipated and left wiggle room for potential court battles ensuing from the unsatisfactory outcome for any party.
Camelot has been synonymous with the UK National Lottery becoming the first and only operator since the lottery launched on November 19, 1994. But there are practical considerations to factor in the choice of Allwyn Entertainment over Camelot. Even though Camelot felt entitled and disputed the ruling, Allwyn promised to raise £46bn for good causes over the 10-year duration of the contract.
This is more than the £38bn Camelot has contributed to the sector since the lottery rolled out. Then again, Camelot took a long time to build the infrastructure that is the lottery today. For example, the company contributed £1.99bn during the 2020-2021 fiscal year, still below the average £4.6bn promised under Allwyn’s winning bid.
In the end, Camelot has withdrawn its objections that the UKGC committed manifest errors and the regulator failed to issue a winner from the bidding process correctly and lawfully.
Image credit: Unsplash.com
