The United Kingdom is emerging as a global leader in the prize competition industry, according to Tom Banks, the newly appointed executive director of the Prize Competition Council (PCC). Established earlier this year, the PCC is designed to represent businesses engaged in prize draws, raffles, and similar promotional activities, providing a cohesive industry voice.
In an interview, Banks outlined the council's goals to help the growing sector adapt to regulatory changes and foster collaboration with government departments, including HM Revenue & Customs (HMRC), to offer clarity for businesses amid the industry's evolution.
He emphasized the significance of the Department of Culture Media and Sport's (DCMS) Voluntary Code of Good Practice for Prize Draw Operators, introduced in May. This code establishes core principles for the sector, aimed at protecting players from potential harm. However, adherence to the code is not legally required; a report by Rokker in August indicated that only 20% of UK operators had signed on by that point. Banks acknowledged the code as a foundational step for the industry.
Describing the UK’s prize-draw market as a “British success story,” Banks credited entrepreneurial technology companies for its growth. He pointed out the UK’s global leadership in prize draw competitions and the innovative efforts of British entrepreneurs in establishing successful gaming enterprises. The PCC aims to advocate for the sector's economic contributions and facilitate responsible market expansion.
There has been a noticeable increase in mergers and acquisitions within the prize draw vertical, with the London-listed operator Winvia acquiring several smaller companies to expand its market presence in the UK. Banks mentioned that adherence to the DCMS code will be a key indicator of quality for potential investors and acquirers.
The Voluntary Code addresses concerns about player protection and ethical marketing, allowing players to set monthly spending limits while also permitting operators to enforce their own limits. Banks encourages all operators not yet participating to sign up, as he believes the code will become a “kite mark” for operators in the industry.
The significance of the DCMS code was also reflected in the recent acquisition of UK prize draw operator SevenCanyon by German lottery brokerage Zeal Network in July. CEO Dr. Stefan Tweraser noted that formalizing regulations in the UK market played a role in their decision to enter the sector, expecting that the industry would advance toward greater regulation.
Although the PCC is still in early stages, it has rapidly grown to about 70 members, representing approximately 90%-95% of the market. Its membership includes a diverse range of operators such as Elite Competitions, Winvia Entertainment, That Prize Guy, Giveaway Guys, McKinney Competitions, Raffolux, and Daymade. Banks highlighted that the board’s composition reflects this diversity, ensuring all voices are heard.
The code is regarded as a milestone for the sector, promoting minimum standards and professionalism. Banks expressed his surprise at how seriously the businesses are taking the code and the progress they have made since its implementation.
The PCC aims to foster a close relationship with the DCMS and HMRC, particularly in light of HMRC’s recent decision to backdate VAT receipts for the sector. Banks noted the importance of VAT issues for members, emphasizing the need for regulatory certainty to build confidence among businesses, especially smaller operators. The PCC plans to assist its members with compliance related to the DCMS code and address emerging regulatory issues.
Direct and constructive engagement with HMRC is a priority for the PCC, ensuring the industry's perspective is properly communicated. Banks underscored the value of transparent discussions with government officials to provide clarity for businesses as the sector continues to grow.
Looking ahead, the PCC intends to elevate its profile and amplify the industry's voice, focusing on enhancing standards consistent with the existing DCMS code. While he refrained from making specific market predictions, Banks expressed optimism about the sector's maturation, acknowledging the rapid changes witnessed in the past six to twelve months. He noted the PCC's commitment to being a leading voice for the sector during this pivotal journey.
