Court of Appeal Stops TNLC from Appealing UK Lottery National Ruling

The New Lottery Company Limited (TNLC) and Northern & Shell PLC has been blocked from appealing against the High Court’s dismissal of its £1.3 billion claim against the Gambling Commission, regarding the granting of the National Lottery license to Allwyn.

In April, Mrs Justice Joanna Smith ruled TNLC and Northern & Shell, owned by British businessman Richard Desmond, had failed to make a case of manifest error on the part of the Commission when the license was awarded to Allwyn in 2022. Following that ruling, Desmond mentioned his plan to appeal against the verdict.

“Vanishingly small” chance

All three grounds of appeal have been dismissed by the Court of Appeal, which ruled TNLC should not be permitted to raise a new legal argument which has already been expressly ruled out in the High Court. In an announcement made by the Commission, the TNLC’s prospects of success were described as “vanishingly small”. The judge also noted TNLC has not suffered any practical loss.

A spokesperson for the Commission said:

"This is an important decision for the operation of The National Lottery and one that we welcome. The Gambling Commission ran a fair and robust competition to award the fourth National Lottery license. None of the contested changes to the license, in the course of its implementation, were substantial or contrary to the relevant procurement regulations.

"The decision gives resounding support to good causes by enabling Allwyn, with oversight from the Commission, to continue with their plans for investment in the National Lottery without further distraction. Our priority remains to continue regulating the National Lottery for the benefit of participants and good causes."

Another loss

This is the latest defeat in the case for TNLC. In June, following the ruling against TNLC, Smith ordered TNLC to pay the Commission’s legal costs, which could total more than £40 million. Smith ruled 75% of these legal costs would have to be paid immediately.

Desmond’s company had issued a two-pronged court challenge to the awarding of the license. The first of these focused on the process the Commission used to score Desmond’s bid when ultimately rejecting the application.

The second of these was regarding the lawfulness of alleged modifications made by the Commission to the contract for the fourth license.

However, Smith ruled the Commission was right to determine Desmond’s bid failed more than half the 23 mandatory requirements for a bid to be considered eligible. According to Smith, there was an “enormous gap” of more than 30 in the scores between Northern & Shell’s aggregate score and that of Allwyn.

Allwyn in the clear

It would appear Allwyn is now finally clear of legal challenges. Following the awarding of the license to Allwyn, the incumbent Camelot delayed the handover to Allwyn with its own legal challenge against the Commission; Camelot was named as the “reserve applicant” in that process, and its then Chief Executive Nigel Railton said it was “shocked by aspects of the decision”.

Allwyn made a counter-claim against Camelot for damages due to the delaying of the £6.4 billion contract. However, the legal challenge was dropped by Camelot in September 2022, after accepting the potential damages covered by the undertakings needed for the appeal to proceed would have been too large.

In January, Allwyn announced what it called a major upgrade to the National Lottery’s digital platforms, with the update allowing Allwyn to offer the largest ever range of National Lottery games.