Lottery company refused extra services

National Lottery group Camelot's hopes of offering extra services were dashed today after regulators refused the move due to "serious" competition concerns.

Camelot had been fighting to overturn a provisional decision by the National Lottery Commission (NLC) last July to block proposals to provide mobile phone top-ups and electronic bill payments.

But the NLC said that, following legal advice, it believed Camelot's plans would breach European competition law.

Camelot described the decision as "bewildering" and said it was already commonplace across Europe for lottery operators to offer these services.

Camelot claimed it had received conflicting legal advice and would now consider its options.

But it signalled plans to challenge the NLC decision, saying it was "confident that it will enter the commercial services business in due course".

It estimates the proposals would have generated £100,000 a week extra for good causes - having pledged 82.5% of profits made by the service.

Paul Charmatz, managing director of commercial services for Camelot, said: "This is a bewildering decision and without precedent in European Union history when you consider that all over Europe other lottery operators offer these services to support their retailers."

Camelot had sought to appease NLC concerns with a raft of measures, such as publishing separate accounts for the new business and employing a competition law officer to police the service.

But the NLC said its legal advice suggested Camelot would effectively be given an unfair advantage through its lottery monopoly in the UK.

Mark Harris, chief executive of the NLC, said: "The Commission is here to protect the long-term propriety of the National Lottery and the £1.6 billion it raises annually for good causes.

"We cannot, as a public body, consent to the proposal that is before us when doing so may place us in breach of European competition law. We have considered whether the risks involved can reasonably be mitigated but have concluded, based on the advice we have received, that they cannot."

Camelot's plans to offer services through its Lottery terminals were backed by retail groups, such as the National Federation of Subpostmasters and the National Federation of Retail Newsagents, which supported the prospect of a new entrant to a market they feel needs more competition to improve terms and services currently offered.

George Thomson, general secretary of the National Federation of Subpostmasters (NFSP), said: "This is a sad day for the bill payment sector and for subpostmasters. We have said previously that bill payment and mobile top-ups remain a hugely important source of revenue for post offices.

"The NFSP has been working closely with Camelot and Post Office, and had this been approved, the result would have been highly beneficial to our treasured national network of post offices.

"The NLC's ruling has further entrenched the unfair and uncompetitive practices that prevail in the bill payment sector."

Parminder Singh, national president of the National Federation of Retail Newsagents added: "We remain of the view that customers are best-served by having available as wide a range of choice as possible as to where and how they pay their bills and will continue to work to achieve this end."

But rival local payment group PayPoint, which has strongly opposed Camelot's plans, welcomed today's news.

Dominic Taylor, chief executive of PayPoint, said: "It would be entirely wrong for Camelot to be allowed to exploit its position as Lottery monopolist and spread its resources to offer unrelated commercial services.

"We are pleased that the National Lottery Commission has accepted the compelling arguments that the proposal was undesirable and contrary to the public interest."

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

Where the spooks get their coffee fix: The busiest Starbucks in the US is also the most secretive

The secret CIA Starbucks

The coffee shop is deep inside the agency's forested Virginia compound
Revealed: How the Establishment closed ranks over fallout from Loch Ness Monster 'sighting'

How the Establishment closed ranks over fallout from Nessie 'sighting'

The Natural History Museum's chief scientist was dismissed for declaring he had found the monster
One million Britons using food banks, according to Trussell Trust

One million Britons using food banks

Huge surge in number of families dependent on emergency food aid
Excavation at Italian cafe to fix rising damp unearths 2,500 years of history in 3,000 amazing objects

2,500 years of history in 3,000 amazing objects

Excavation at Italian cafe to fix rising damp unearths trove
The Hubble Space Telescope's amazing journey, 25 years on

The Hubble Space Telescope's amazing journey 25 years on

The space telescope was seen as a costly flop on its first release
Did Conservative peer Lord Ashcroft quit the House of Lords to become a non-dom?

Did Lord Ashcroft quit the House of Lords to become a non-dom?

A document seen by The Independent shows that a week after he resigned from the Lords he sold 350,000 shares in an American company - netting him $11.2m
Apple's ethnic emojis are being used to make racist comments on social media

Ethnic emojis used in racist comments

They were intended to promote harmony, but have achieved the opposite
Sir Kenneth Branagh interview: 'My bones are in the theatre'

Sir Kenneth Branagh: 'My bones are in the theatre'

The actor-turned-director’s new company will stage five plays from October – including works by Shakespeare and John Osborne
The sloth is now the face (and furry body) of three big advertising campaigns

The sloth is the face of three ad campaigns

Priya Elan discovers why slow and sleepy wins the race for brands in need of a new image
How to run a restaurant: As two newbies discovered, there's more to it than good food

How to run a restaurant

As two newbies discovered, there's more to it than good food
Record Store Day: Remembering an era when buying and selling discs were labours of love

Record Store Day: The vinyl countdown

For Lois Pryce, working in a record shop was a dream job - until the bean counters ruined it
Usher, Mary J Blige and Will.i.am to give free concert as part of the Global Poverty Project

Mary J Blige and Will.i.am to give free concert

The concert in Washington is part of the Global Citizen project, which aims to encourage young people to donate to charity
10 best tote bags

Accessorise with a stylish shopper this spring: 10 best tote bags

We find carriers with room for all your essentials (and a bit more)
Paul Scholes column: I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England

Paul Scholes column

I hear Manchester City are closing on Pep Guardiola for next summer – but I'd also love to see Jürgen Klopp managing in England
Jessica Ennis-Hill: 'I just want to give it my best shot'

Jessica Ennis-Hill: 'I just want to give it my best shot'

The heptathlete has gone from the toast of the nation to being a sleep-deprived mum - but she’s ready to compete again. She just doesn't know how well she'll do...