TGP Europe’s recent decision to surrender its British gambling licence following an investigation by the Gambling Commission (the “Commission”) is another example of the Commission’s commitment to holding its licensees accountable for the activities of their partners. This article examines the circumstances surrounding TGP Europe’s exit from Great Britain, the regulatory implications, and the broader impact on operators, sports clubs, and consumers.

Background 

The Commission announced that TGP Europe, which had operated a “white label” model under various brand partnerships, surrendered its licence due to findings of insufficient business-partner checks and breaches of anti-money laundering (AML) rules. According to the Commission, these breaches ranged from inadequate due diligence on ownership structures to insufficient consideration of potential illegal activities by third parties. TGP Europe faced a £3.3 million penalty and required major improvements, but opted to withdraw entirely from the British market instead.

Previously, TGP Europe had been fined £316,250 in 2023 for similar failings, including not effectively mitigating money laundering risks and deficient due diligence before entering white label agreements. 

In its statement, the Commission stated that TGP had failed to: 

• carry out effective due diligence on each entity involved in the ownership of the third party;
• carry out due diligence on the source of funds for business arrangements;
• sufficiently consider money laundering risks; and/or
• sufficiently consider any activity by a third-party that is illegal, in either GB or the territory in which it is conducted.

What does this mean? 

The Commission’s move to impose a further penalty on TGP highlights its strict approach to licensees that fail to apply proper checks and controls to their partners. This decision takes place in the backdrop of enhanced enforcement activity in relation to B2B providers, a theme we anticipate will continue. 

The Commission’s decision also has potentially significant ramifications for a number of English football clubs, whose gambling sponsors were operating in Great Britain through a TGP Europe-operated site. Following the decision, those gambling sponsors can no longer provide gambling services to British customers, and the clubs involved run the risk of committing the offence of advertising unlawful gambling. To avoid this, clubs will either need to remove all sponsorship inventory in the UK or be able to demonstrate that people in Britain are blocked from accessing the services provided by the sponsor (unless and until it procures a new British-licensed white label partner, which may be challenging in the current environment). Clubs must also obtain reassurance that such blocks are effective. The Commission has made it clear that it will take appropriate action if customers are able to easily circumvent geo-blocking measures using VPN or other methods and will be conducting regular checks. 

What next? 

For operators, this decision should serve as a reminder of the Commission’s focus on ensuring its licensees implement proper checks on, and actively manage relationships with, partners. We are anticipating a ramping up of Commission enforcement activity in relation to B2B activities, as well as a continued focus on the white label market, and so now is the time to make sure policies, procedures and (crucially) practices are up to date and compliant. 

The football clubs involved will have to consider whether to continue with the sponsorship arrangements, taking into account the club’s risk appetite and assurances that the sponsor can provide about its geo-blocking capabilities.

For any other clubs with gambling sponsors, particularly those who operate in the British market through a white label arrangement, now would be a good time to double check sponsorship agreements, and make sure it gives flexibility to terminate or amend the relationship if a similar situation arises. Unless an agreement specifically contemplates this situation, it can sometimes be difficult to unilaterally amend the sponsorship rights or ensure a clean exit.