Clause 143 - Form of licence
Gambling Bill
3:00 pm

Mr Don Foster (Shadow Secretary of State for Culture, Media & Sport, Culture, Media & Sport; Bath, Liberal Democrat)

I beg to move amendment No. 226A, in clause 143, page 63, line 36, at end add

'and 

(i) specify an area (being all or part of the casino premises) for the purposes of section 158(4) in relation to those casino premises (''a designated gaming area'') and identify the same upon or by reference to the plan to be included under paragraph (g) above.'.

Mr Roger Gale (North Thanet, Conservative)

With this it will be convenient to discuss amendment No. 227A, in clause 158, page 71, line 29, at end add—

'(4) Each casino premises licence shall by virtue of this subsection be subject to the mandatory conditions that the licensee—

(a) shall not operate gaming tables or gaming machines of Categories A or B outside a designated gaming area prescribed in relation to the relevant casino premises under section 143(1)(i),

(b) shall not permit any person other than the licensee or a person employed by the licensee to perform any function within the casino to enter a designated gaming area whilst the same is being used in reliance of the casino premises licence without the production at the entrance thereto of satisfactory evidence of identity, and

(c) shall maintain a condition of door supervision in respect of the designated gaming area at all times whilst the same is being used in reliance of the casino premises licence.

(5) Regulations under this section may, in particular, add or exclude gaming machines of a particular category or categories from gaming machines which are the subject of subsection (4) provided always that such regulations shall not permit gaming machines of Category A to be so excluded.

(6) In subsection (4) ''satisfactory evidence of identity'' means evidence which is reasonably capable of establishing (and does in fact establish to the satisfaction of the person who obtains it) the name, address and a photographic likeness of the person producing the evidence, and that such person is over the age of 18 years on each occasion that satisfactory evidence of identity is required to be produced under this Act (including the proffering on a second or subsequent occasion of entry of a card or token issued to them by the licensee of the casino premises) for the purpose of verifying the identity of such person by reference to a photographic image stored visually or electronically upon the card or token, or upon a system maintained by the licensee of the casino premises for such purpose.'.

Mr Don Foster (Shadow Secretary of State for Culture, Media & Sport, Culture, Media & Sport; Bath, Liberal Democrat)

After a short pause, I rise with some trepidation and concern. Having had a phenomenally successful run this morning, I am confident that I shall not have any success whatever in relation to this issue. We return yet again to the debate we had on clause 83 concerning the requirements for identity. During those deliberations, the Minister made it clear that we were to wait for further information in relation to the third European directive on money laundering, among other matters. I am merely giving him the opportunity to say something that he might have omitted during our discussion of clause 83 or that has come to light since that discussion.

Mr Richard Caborn (Minister of State (Sport and Tourism), Department for Culture, Media & Sport; Sheffield Central, Labour)

My lengthy brief has been condensed to three paragraphs, which will accord with the Committee's wish that we focus on the issues this afternoon. I shall give a full explanation of the position on money laundering, and it would be helpful if I did so without being asked to give way because the position is somewhat complex.

Casinos throughout Europe are subject to a money laundering directive, which, as well as imposing requirements on a wide range of financial institutions, requires casino customers to be identified if they buy or sell chips above a value of è1,000. However, two   things are set to change. First, the Bill will remove the requirement in the Gaming Act 1968 for casinos to operate as members' clubs. It will, of course, be open to casinos to continue to operate as members' clubs if they wish, and we made that clear during an earlier debate. Some may choose to do so, but others may not, and we should not frame the Bill in the expectation that all casinos will be for members only, which is an unnecessary regulatory requirement provided that other safeguards are in place.

The second change in prospect is that the EU is currently considering a new draft money laundering directive, which will reinforce and extend the controls in the present directive. The Treasury remains in the lead on that and has been consulting interested bodies, including law enforcement agencies, regulators and, of course, the businesses that will be affected by the new directive, including casinos. People going into such areas will have to go through identity checks, whether or not they gamble. In the Government's view, that is unnecessary for a number of reasons. First, requirements as to identification and verification of identity for the purposes of controlling money laundering can and, indeed, should be set in specific money laundering regulations made by the Treasury, which implement the requirements set out in the EU directive. We cannot yet be sure what the new directive will require, and it would not be sensible to try to anticipate it by including detailed and specific provisions in the Bill.

Secondly, we are not persuaded that it would be right in future to require identification on entry in all cases, even though we do so now. As I have explained, the casinos of the future will not be the same as casinos now. Furthermore, the identification requirements in the new directive are likely to be more challenging than the requirements in the present directive. It would not be appropriate to go into the details of the consultations that have been taking place with industry bodies, or the discussions with other member states.

We expect that, fairly soon, a proposal will be agreed by member states and go to the European Parliament for consideration. What I can say is that it is likely that the new directive, like the present directive, will provide a choice between mandatory identification at the point of crossing a financial threshold or identification on entry. I can also say that a number of casinos have made clear their view that, in the context of the system of gambling regulation proposed in the Bill and, in particular, the removal of compulsory casino membership schemes, it would be more appropriate to check the identity of customers at the financial threshold and not at the physical threshold of the premises or some specific area of the premises. The amendment would shut off that option by requiring identification on entry to that area of a casino that includes gaming tables and higher-value gaming machines. I ask the hon. Gentleman to withdraw his amendment. 

Mr Don Foster (Shadow Secretary of State for Culture, Media & Sport, Culture, Media & Sport; Bath, Liberal Democrat)

I am grateful to the Minister for amplifying some of the points he raised during our consideration of clause 83. May I tell him gently that he has said in two different ways that he firmly believes that the third European directive will be more challenging than the second? He also said that the third directive will be likely to reinforce and extend the controls in the second. Regulation 8(1) of the Money Laundering Regulations 2003 and article 9 of the draft third EU directive make it clear that the issue of identity does not come in only when there is an exchange of funds in excess of è1,000. Regulation 8(1) says:

''A person who operates a casino by way of a business in the United Kingdom must obtain satisfactory evidence of identity of any person before allowing that person to use the casino's gaming facilities.''

That means before any use—regardless of whether there is an exchange in excess of è1,000.

Article 9 states:

''Member states shall require that all casino customers shall be identified''.

The identity must be verified later when there is a transfer of è1,000.

I suggest that the Minister's statement that the situation will occur only when money changes hands, is unlikely to be reflected in the third European directive. He nevertheless makes the fair point that it would be better to wait for that directive in order to ensure that it will apply to all casinos in the United Kingdom, and that it is not necessary to require such provision in the Bill. There will be a further opportunity when we have more information about the development of the third directive.

Mr Richard Caborn (Minister of State (Sport and Tourism), Department for Culture, Media & Sport; Sheffield Central, Labour)

I have made two points. The money laundering directive is about much more than casinos, and the Treasury is discussing it with businesses, banks and regulators. The regulations under the second directive required identity checks on entry, but we are considering how to implement the third directive. It is under discussion with industry, but the lead Department is the Treasury, and the hon. Gentleman will appreciate that the implementation of the third directive has much wider implications than just for casinos.

Mr Don Foster (Shadow Secretary of State for Culture, Media & Sport, Culture, Media & Sport; Bath, Liberal Democrat)

I am grateful for that further explanation. The Minister will be aware that there are concerns additional to those about money laundering. They lead some people, including myself, to believe that identity provision might be useful, particularly for tracking problem gamblers. For those reasons, I believe that this is an issue to which we will return, but I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 143 ordered to stand part of the Bill.

Clause 144 ordered to stand part of the Bill.