Camelot granted right to appeal against handing UK lottery to Czech rival

The UK National Lottery operator Camelot on Thursday won the right to appeal against a High Court ruling that ordered it to begin handing over the licence to rival Allwyn, extending the hotly contested battle for one of the most lucrative government contracts.

Lord Justice Coulson granted Camelot permission to appeal against the decision from last month, which concluded that an automatic suspension of the handover process, put in place after Camelot challenged the Gambling Commission’s decision to award Allwyn the 10-year licence, should be lifted.

But Coulson’s ruling means the suspension will now remain in place until the week of September 12, when the appeal hearing is expected to be heard. The decision keeps alive Camelot’s hopes of overturning the Gambling Commission’s decision. IGT, Camelot’s technology supplier, is also challenging the decision in court.

The Gambling Commission said it was “disappointed” with the outcome of the appeal hearing but stressed that it “respect[s] the court’s decision”. The wait until mid-September would “generate challenges” for the transition of the fourth licence, it added.

“We regret the decision by third parties to bring legal proceedings following the outcome of a highly successful competition for the fourth National Lottery licence, actions which could impact transition to the fourth licence and, ultimately, funding for good causes,” the regulator said.

Allwyn — Europe’s largest lottery operator with operations spanning the Czech Republic, Italy and Greece — won the bid after pledging to halve ticket prices to £1, double the amount of money generated for good causes and invest heavily in new digital products.

But Camelot argues that the Gambling Commission should not have discounted a “risk factor” score to the bids, as it favoured the more ambitious but potentially risky business plan of Allwyn.

Estimates suggest the 10-year licence will be worth up to £100bn in sales.

On Friday, Camelot gave the court undertakings that it would repay Allwyn and the Gambling Commission if it lost the case. But Justin King, former boss of supermarket J Sainsbury and chair of Allwyn’s bid, called on Camelot to provide undertakings for how it would compensate the National Lottery’s charitable causes’ fund if the transition of the fourth licence was delayed.

“It is common ground [between the parties in the case] that this delay will damage the introduction of the benefits the fourth licence brings for good causes,” he said.

Camelot welcomed the granting of an appeal, rejecting King’s argument that the National Lottery’s charitable fundraising could be harmed.

“The risk to future returns to good causes is at the heart of the matter in this case,” it said, adding that the Gambling Commission’s own bid evaluators had “described Allwyn’s plans to deliver the revenue growth it forecasts as ‘implausible’ and identified an array of risks which could impact returns for good causes”.

Camelot generated £1.9bn for good causes from ticket sales in the year to March 31.