The Gambling Commission is reviewing whether it needs to take regulatory action against Allwyn after The National Lottery operator missed a contractual milestone.
The issue was listed among risk factors in Allwyn’s 2024 annual report, and noted the UK regulator had commenced its review.
While Allwyn did not disclose what the contractual milestone entailed, the operator confirmed it had not been reached within the reporting period.
Allwyn took over the UK National Lottery in February 2024, having won the tender competition against long-term licence holder Camelot and other rival bidders.
The annual report read: “While Allwyn UK continues to progress as expeditiously as possible while prioritising contributions to good causes, after the end of the reporting period a contractual milestone in the enabling agreement was not reached.
“The Gambling Commission is reviewing what, if any, enforcement action might be taken against Allwyn UK in relation to that milestone.”
Also included within the report was commentary on the rising costs of delivering technology changes across The National Lottery, including swapping IGT for Scientific Games as a third-party partner.
While progress has been slower than expected, Allwyn said the legal challenges over being awarded the fourth licence have also hampered progress.
Richard Desmond’s Northern & Shell is in the middle of legal proceedings against the Gambling Commission over its decision to award the licence to Allwyn.
Allwyn added: “This comprehensive technology transformation has significant scale and complexity, and is now taking place on a different timetable to that initially envisaged, owing in part to legal challenges against the Gambling Commission in relation to its fourth National Lottery licence competition.
“The timetable is more demanding operationally, while the delivery of the transition also depends in part on third-party suppliers.”
The operator, which also runs lotteries across Europe, added that the business will continue to “incur significant costs in the transition process”.
In 2024, adjusted EBITDA in the UK slumped from €181.4m to just €35m for Allwyn, as marketing and tech costs soared.
A Gambling Commission spokesperson said: “Where the Gambling Commission decides to commence enforcement action, the process is investigative in nature. We do not usually talk about individual cases. We may publish information about enforcement cases once they are complete.”
A spokeswoman for Allwyn UK said: “Allwyn is investing more than £350m into the essential modernisation of The National Lottery, which hasn’t had a significant technology upgrade since 2009.
“Our investment will help restore the magic to The National Lottery, but the shift from outdated systems is complex and requires robust testing.
“We will deliver these essential upgrades over the coming year. We are working at pace to complete this transformation as soon as possible.”
The post Allwyn could face Gambling Commission enforcement measures first appeared on EGR Intel.
Lottery operator’s annual report notes the regulator is deciding whether to take action after firm failed to hit a contractual milestone, as per its licence
The post Allwyn could face Gambling Commission enforcement measures first appeared on EGR Intel.