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Camelot launches legal challenge after National Lottery loss

Camelot, which is owned by Canadian pension fund The Ontario Teachers’ Pension Plan, was instead named as the reserve applicant. Photo: PA
Camelot, which is owned by Canadian pension fund The Ontario Teachers’ Pension Plan, was instead named as the reserve applicant. Photo: PA (PA)

Camelot is to launch a High Court challenge over claims Britain’s gambling regulator broke the law in choosing Allwyn Entertainment as the new operator for the National Lottery.

The case comes as Camelot believes the UK’s Gambling Commission changed the rules after it came out in pole position in a scoring system designed to measure the bids.

Instead last month, Allwyn Entertainment, previously known as Sazka Entertainment, was announced as the preferred bidder, and is set to take over in 2024, when Camelot’s licence ends. The new licence will run for ten years, until 2034.

The company is a UK-based subsidiary of Europe’s largest lottery operator Sazka, which is owned by Czech oil and gas billionaire Karel Komarek. The tycoon has an estimated net worth of around $8bn (£6bn).

It currently operates across Europe, including the Czech Republic, Austria, Greece, Cyprus, and Italy as its key markets.

Camelot, which is owned by Canadian pension fund The Ontario Teachers’ Pension Plan, was instead named as the reserve applicant.

Read more: National Lottery: The new company taking over Lotto

“We are launching a legal challenge today in our capacity as an applicant for the fourth licence because we firmly believe that the Gambling Commission has got this decision badly wrong. When we received the result, we were shocked by aspects of the decision,” Nigel Railton, chief executive of Camelot, said.

“Despite lengthy correspondence, the Commission has failed to provide a satisfactory response. We are therefore left with no choice but to ask the court to establish what happened.

“Irrespective of Camelot's dual roles as current operator and applicant for the next National Lottery licence, the competition is one of the largest UK government-sponsored procurements and the process deserves independent scrutiny.”

Camelot has always been the operator in charge of running the UK’s national lottery since it launched in 1994.

When selecting Allwyn at the time, Andrew Rhodes, Gambling Commission chief executive, said: “I am confident that the success of the competition will lead to a highly successful fourth licence — one that maximises returns to good causes, promotes innovation, delivers against our statutory duties, and which ultimately protects the unique status of the National Lottery.”

Read more: European stocks edge down ahead of US payrolls

Since launching almost three decades ago, the UK national lottery is one of the largest lotteries in the world, and has raised more than £45bn for around 660,000 UK causes.

According to the Department for Digital, Culture, Media and Sport, for every £1 of National Lottery ticket sales in 2019-20, 23p went to good causes, 12p to the government in lottery duty, 55p to winners in prizes, 4p to ticket retailers, 6p retained by Camelot to meet costs and returns to shareholders, and 1p kept by Camelot in profits.

Watch: National Lottery operator Camelot fined £3.15 million for giving incorrect results

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