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Ensuring a fair Lottery for the nation
£24 billion for good causes
£36 billion in prizes

Section 5 Licence

The section 5 licence is the operating licence that is granted by the National Lottery Commission to the operator under section 5 of the National Lottery etc. Act 1993 (as amended). 

The current section 5 licence was granted to Camelot and began on 1 February 2009. The term of the licence is 10 years, though the licence provides for the possibility of extending that term for an additional period of up to five years.  

Broadly speaking, the licence sets out the way in which, and the standards to which, the National Lottery must be run. 

The National Lottery etc. Act 1993 (as amended) provides that the section 5 licence must contain a condition that requires the operator to pay sums to the National Lottery Distribution Fund (NLDF) and the Olympic Lottery Distribution Fund (OLDF). These funds are the channels through which the operator transfers the ‘good cause’ allocation of Lottery income to the Secretary of State. This money is then divided between the distribution bodies.

The section five licence covers ten core regulatory areas:

The Control Environment, ensuring that the licensee has a strong and effective internal control framework and adheres to high standards of corporate governance and conduct;Lottery systems;Game operations;Prize validation and payment;Consumer protection;Retailing;Marketing;Revenue collection and banking;Security; andAncilliary activites.p. The section 5 licence contains conditions that require the operator to issue and comply with codes of practice, strategies or procedures that are subject to the approval of the Commission.  They relate to the following areas of operation:

Procedures in relation to the implementation and testing of systems (condition 5).Strategies to prevent underage and excessive play (condition 7).Availability of top prizes in Scratchcard lotteries (condition 7).Advertising and sales promotion (condition 7).Strategy for encouraging proposals by independent section 6 licensees (condition 9.)p. A full copy of the section 5 licence is available to download as a PDF document from this page.

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