UK Lottery Operator Allwyn Must Account on Donations: Lawmakers

Posted on: February 20, 2024, 08:22h. 

Last updated on: February 20, 2024, 11:59h.

As Czech company Allwyn takes over the reins of the UK National Lottery, Britain’s lawmakers are seeking guarantees that the new operator will meet its commitment to donate revenue to good causes.

Allwyn, UK Lottery, National Lottery, Karel Komárek, Robert Chvátal, Carolyn Harris, Iain Duncan Smith, UKGC
Allwyn won the £80 billion lottery contract despite its owner, Karel Komárek, above, having business ties with Russian state-owned energy giant Gazprom. (Image: Czech Crunch)

Allwyn displaced Camelot, which operated the lottery since its 1994 inception, following a hard-fought bidding war. It won the estimated £80 billion (US$100 billion) 10-year contract largely because it promised to raise £38 billion (US$48 billion) for good causes over the next decade, giving £3.8 billion per year. Camelot, which has since been acquired by Allwyn, gave an average of slightly more than £1 billion per year over its 29-year tenure.

‘Chance to Catch Up’

But the new operator has also admitted that it won’t hit its promised short-term targets. The company blamed delays in the handover process caused by legal challenges brought by losing bidders. Allwyn says it remains committed to delivering the full amount pledged over the 10-year contract.

The phasing has changed,” Robert Chvátal, Allwyn’s chief executive told The Financial Times last October, adding that “in the great scheme of things of 10 years, we have a chance to catch up.”

Now, lawmakers are asking the UK Gambling Commission (UKGC) to explain how it plans to hold Allwyn to account.

In a letter to the regulator seen by The Guardian, the all-party parliamentary group (APPG) on gambling-related harm asked “what action is being taken to ensure that returns to good causes are prioritized and increased under the new contract.”

Russia Ties

Led by the Labour Party’s Carolyn Harris and former Conservative Party leader Iain Duncan Smith, the APPG was established to advise the government on proposed gambling reforms. In its letter to the UKGC, the group also wanted to know more about Allwyn owner, Czech billionaire Karel Komárek, and his business ties to Russia.

After Allwyn was named as the UKGC’s preferred bidder for the lottery, it emerged that Komarek joint-owned an underground gas storage facility in the Czech Republic in a 50-50 partnership with the Russian state-owned energy giant, Gazprom.

Last Friday, Komárek’s holding company, KKCG, announced that Gazprom’s stake in the venture had been reduced to below 3%. KKCG is expected to remove the Russian company’s interest in the facility entirely by the end of the year.

The APPG demanded the Gambling Commission provide “further information on the thorough checks that the Commission has undertaken, and will continue to, regarding Allwyn’s ownership and that of its affiliates.”