Gaming machine permissions: a legal guide for pubs

This is a good time, then, for a brief guide to making gaming machines available in pubs. Starting with the basics, licensed premises can provide gaming machines to their customers if:

• They benefit from an on-licence.
• They contain a bar at which alcohol is served for consumption on the premises.
• There is no requirement that alcohol is served only with food.

If you comply with the above, customers can use machines at times when alcohol may be supplied in reliance on the licence, or in Scotland sold for consumption on the premises.

Pubs are permitted machines defined as category C or D. Category C machines, often called AWPs (amusement with prizes), fruit machines, and one-armed bandits, have a maximum stake of £1 and a maximum prize of £70. The maximum stake and prize for category D machines depends on the type of machine. Cash prizes are limited to £5 (or £8 cash if the prize is combined money and non-money) and up to £50 for non-cash prizes awarded by the crane grab machines. The maximum stake is generally 10p, 30p or £1 for the crane grab machines. Most pubs have category C machines; category D machines are more commonly found in bowling centres, cinemas and other entertainment venues and sometimes the larger pubs.

To benefit from gaming machines you must either:

• For one or two machines, notify your licensing authority that you will be making the gaming machines available for use on the premises and pay a £50 fee.
• If you want three or more machines then you must apply to the licensing authority for a licensed premises gaming machine permit, stating the number of C or D machines you wish to have. For higher numbers of machines you may have your application considered by the licensing committee at a hearing. You must pay a £150 fee for the application and once granted there is a £50 annual fee. If the annual fee is not paid the licensing authority will revoke your licence.

It’s only the holder of the premises licence who can notify that they are benefitting from the automatic entitlement or apply for a permit.
In many cases the reason that the pubs did not have permission for their machines was that a transfer of the alcohol licence had taken place and no consideration was given to the machines. If you transfer a premises licence, and you have one or two machines, then the incoming premises licence holder must notify the council that they intend to benefit from the automatic entitlement. Similarly, if the premises benefit from a licensed premises gaming machine permit the applicant for the transfer of alcohol licence must also apply to transfer the permit into their name.

It’s worth revisiting the rules on the location of machines. You are required to position machines where they can be supervised, and often the best position is near the bar. A lesser known rule is that gaming machines should not be positioned next to cash machines. Make sure there is sufficient distance between your cash and gaming machines.

Positioning machines so they can be supervised is important as it helps ensure under-18s do not play on the category C machines. They can play on the category D machines. Licensing authorities are increasingly undertaking trading standards operations in relation to age verification and playing on category C machines.