Insights Annual fees – what licensees need to know

The Commission has recently issued a reminder to the industry regarding updates to annual licence fees and applications to vary a licence. While this looks to have been primarily to emphasise the importance of submitting variation applications well in advance of an annual fee becoming due, we felt it was an apt moment to review the steps Commission-licensed operators need to take in terms of paying annual fees.

When are annual fees due?

Annual fees are due on the anniversary of the date that the operating licence was originally issued (which is stated on the operating licence itself), though the Gambling Act 2005 requires operators to pay the fee in full ahead of this date. The Commission is no longer emailing PDF invoices to operators and instead will notify operators by email around six weeks before the fee is due, and invoice details will also be available on the eServices platform.

How much do the annual fees cost?

The exact cost of the annual fee will depend on (i) the precise licensable activities the operator carries out; and (ii) what the applicable fee categories in respect of the licensable activities are (which is usually dependent on an operator’s annual gross gambling yield).

Operators will be informed of their annual fees when applying for or varying an operating licence. If these figures aren’t easily to hand, operators can check their annual fees using the Commission’s fee calculator.

What if the licence needs to be varied?

The point that annual fees become due is likely to serve as a prompt for operators who need to vary their licence. For instance, an operator may need to remove a licensed activity that it no longer provides, or its gross gambling yield may have changed such that it falls under a new fee category. Variations such as these, which will directly influence the fees payable, can be carried out using eServices. This page on the Commission website details the cost of such variations and the supporting documents required – for example, an operator will be required to provide evidence that it is no longer providing a particular licensed activity to customers.

How will varying our licence affect our annual fees?

It’s important to note that the licence fee payable by an operator will be based on the licence it holds on the anniversary date. If the operator has submitted a variation application, the Commission must grant the variation before the anniversary date in order to impact the annual fees. If the variation isn’t granted before the anniversary, the fee due will be that of the current licence. This means it’s vital that any application is sent well in advance of the licence anniversary date. The Commission states that it aims to process and grant variations within eight weeks of receipt, however this isn’t guaranteed and, in our experience, can take much longer, particularly where there are other outstanding applications (e.g. an outstanding change of corporate control application).

What if our variation application is granted after we’ve paid a higher licence fee?

If the variation application is accepted and results in a lower licence fee applying, meaning the operator has overpaid in the first instance, the Commission says it will offer a refund. This is the only circumstance in which a refund will be offered on application or annual fees.