Guidance

Guidance for responsible authorities

Updated 30 December 2022

Foreword

The government is in the process of developing plans to unlock the digital economy, improve access to services, safeguard privacy and combat fraud through the expansion in the use of digital identities. In principle, this will allow people to establish their identity digitally, rather than relying on physical documents. One area that has been identified as a key challenge to this policy development is the mandatory condition set out in the Licensing Act 2003 (Mandatory Licensing Conditions) Order 2010, which requires identification bearing a holographic mark or ultraviolet feature and therefore presentation of a physical ID upon request when purchasing alcohol.

It has become increasingly important in this digital age to be able to establish trust, particularly online. Having an agreed digital identity that you can use easily and universally will be the cornerstone of future economies. Many parts of government have a role to play in digital identity and have been brought together in a cross-government Strategy Board. The Department for Digital, Culture, Media and Sports is focused on enabling and growing the use of digital identity in the wider economy, while government’s use of digital identity tools is a matter for the Cabinet Office.

In support of the government’s plans for broader use of digital technology in everyday life, the Home Office has worked with the Office for Product Safety and Standards (OPSS) to develop proposals for a Regulatory ‘Sandbox’ to allow the trial of technologies that can fulfil the legislative requirement for age verification in the retail sale of alcohol.

The government is keen to encourage efforts to develop new technology to improve the experience of consumers and retailers when purchasing age restricted products. However, the need for strong national standards for age verification technology remains paramount in order to provide confidence to retailers and consumers alike that they are fit for purpose.

This Guidance is intended to assist responsible authorities who may be contacted by applicants for the call for proposals for the Regulatory ‘Sandbox’. We have been clear with applicants that they must ensure that local responsible bodies, particularly licensing authorities, police and trading standards agree to the trials proposed in their area.

Finally, we would like to thank local responsible bodies for your help and assistance with bringing these proposals for technology trials to fruition. Your time and effort is greatly appreciated.

Introduction

The Home Office, in partnership with the OPSS, is keen to explore how technology can improve or enhance achieving the licensing objectives for the retail sale of alcohol, most notably for this trial, the protection of children from harm.

This guidance document is intended to assist local responsible authorities under the Licensing Act to consider and respond to proposals to undertake technology trials in their local area.

We have issued a call for proposals alongside this guidance. Technology providers and operators of licensed premises are invited to submit proposals to us for operating trials as explained in both the call for proposals and this guidance. The call focusses on the protection of children from harm and, in particular, how technology can support licensed premises to secure better outcomes for achieving this objective, including the protection of children as vulnerable citizens.

In some cases, the Licensing Act, Regulations, Guidance, Conditions and Practice may hinder, prohibit or otherwise stifle innovative approaches or technological advances. The purpose of a regulatory sandbox is to allow live, time-bound testing of innovations under controlled conditions, with the approval of government and local regulators.

Sandboxes are wholly funded by private enterprises, there is no government funding or support available for the trials and if any responsible authorities are requested to be active participants in the trial in their area. No specific fee raising powers are established for this call for proposals and whether to charge fees for your active involvement in the trials is a matter for local discretion in accordance with relevant revenue raising powers that you may have.

The approval of a test or trial does not imply that, even if successful, it will result in legislative change or improvement, although it will be taken into account alongside the views of all stakeholders in our usual policy development process. Applicants for a sandbox are advised from the outset that the results of their test or trial may not result in any policy changes being implemented by government.

What will a sandbox allow?

The sandbox offers innovators the opportunity to run a small-scale trial under authorisation from the Home Office and Office for Product Safety and Standards, provided the applicant has the agreement of the local licensing authority and local chief officer of police to conduct the trial. A sandbox creates a conducive and contained space where experimentation with technological innovations can take place with confidence and support from responsible authorities.

Innovators will need to describe how they will continue to comply with legal age verification requirements during the trial. This should include agreements with local enforcement, such as the local police, local licensing authority or local trading standards.

It is a matter for you, as responsible bodies, to set your own enforcement policies and for prosecutors, such as the CPS, to consider the public interest in taking any regulatory action.

You will need to balance the potential risks of the proposed trial with the potential benefits of the trial in securing improved compliance and reduced harm to children in the future. We are confident that trials can be proposed by innovators that strike the appropriate balance of risks, that respect the need to secure compliance throughout the trial and provide an opportunity to learn how technology can contribute to improvements for the future. We hope that the need for local agreements to be in place will allow trials to proceed in a collaborative environment with reduced risk to the public. However, we respect the role of local enforcement to act in the exercise of its powers.

Applicants will need to describe how they will continue to comply with legal age verification requirements during the trial. We have made this clear in the call for proposals that we have issued to innovators. Each trial would run for a set period of time with a limited number of locations.

What a sandbox will not allow?

A sandbox is not intended to provide relief from sanctions for selling or supplying alcohol to children, even as a result of the trial itself or elsewhere in the outlet where the trial is taking place.

Proposals for a sandbox will not result in any changes to requirements or regulation on a permanent basis. To make permanent changes to regulation, we follow established processes leading to industry-wide changes available to all parties. Sandbox trials can provide evidence to help us understand whether regulation should change permanently.

A sandbox cannot be used for relaxation of conditions imposed on a specific premises by a local licensing authority. It is important that local responsible bodies have confidence in the management of outlets that a proposed trial may take place in. For this reason, it may not be appropriate to conduct a trial at a location with a history of non-compliance or where enforcement action or additional local conditions have been necessary. However, it is possible that such a location is on a genuine path of improvement and a technology trial may assist with that. That is, of course, a matter for local decision. A sandbox is not a means to evade or eliminate regulatory controls, improvement actions or enforcement activity by local responsible authorities.

A sandbox is not an endorsement from government, police or any regulatory bodies for a specific business model, product, service or new way of doing something. We would urge local responsible bodies that are actively engaged with sandbox trials to avoid conferring any endorsement of the product or service under trial, although we accept that issuing Assured Advice under the Regulatory Enforcement and Sanctions Act may be appropriate or necessary in support of a sandbox trial.

What a sandbox will produce?

We expect the trial to have explicit learning objectives to test the viability of the model under test or trial. The innovator will report what it has learnt. The Home Office and OPSS will consider the results during future policy development. The results of a trial will be published.

We expect innovators to work with the relevant local responsible bodies to keep them informed and updated on progress with the trial and the results.

What are the benefits of a sandbox?

We hope that a regulatory sandbox can help to bring the cost of innovation down, reduce barriers to entry, and allow regulators and government to collect important insights before deciding if further regulatory action or improvement of legislation is necessary.

What kind of technological innovations might be suitable for a sandbox?

We want to encourage ideas for innovation and some of the technologies that may be suitable for a sandbox include:

• Technologies that enhance the likelihood of preventing young people under 18 years old from accessing alcohol
• Technologies that help reduce violence or abuse towards workers in licensed premises when challenging young people for ID
• Technologies that secure effective controls on delivery, click & collect or dispatch of alcohol
• Technologies that reduce the burden on business for gaining age assurance
• Technologies that enhance the protection of personal data of customers purchasing alcohol

Proposals can relate to the retail sale of alcohol, on or off licensed premises, supply in clubs or postal, remote or novel manners of the delivery of alcohol. They can include for new or emerging technologies, delivery channels or operational processes.

How are local responsible authorities likely to become involved in the trial?

We have made it a condition of the call that applicants can demonstrate that local relevant responsible bodies have agreed to the proposed trial and that successful applicants will secure the support of those responsible bodies through formal agreement. As a result, we anticipate during the call for proposals, you may be approached by one or more potential innovators about their proposals.

It is, of course, a matter for local discretion on whether you wish to engage in this sandbox, but we would like to encourage you to do so. We believe that this is in the public interest of securing better protection of children from harm through the licensing regime.

We do not envisage that this process be particularly onerous or overly formal. Whilst the level of your knowledge, proposed involvement or other matters relating to the trial should be recorded in writing and submitted with the application, this can be a simple letter or email. A formal agreement should then be in place before any successful application begins.

The selection panel may have additional questions on proposals, which may include seeking further assurance on the knowledge and involvement of responsible authorities.

You may be asked to be active participants in the trial, perhaps through witnessing, inspecting or having direct oversight of the trial. The level to which you want to do that, charge any fees for that or participate at all is a matter for local discretion.

Once the trial commences, we encourage you to communicate with local officers that the trial is taking place and advise them of any specific considerations that they need to have when visiting, inspecting or dealing with enquiries about the outlet within the scope of the trial. You may also need to consider any involvement in local publicity or media interest in the trial.

During the course of the trial, we have made clear to applicants in the call for proposals that the Home Office and OPSS may remove its support for the trial and end any agreement to participate in the sandbox if they consider that the trial is placing the licensing objectives at risk or could be bringing the concept of offering a regulatory sandbox into disrepute. We will very much rely on you as local responsible bodies to advise us if you have concerns about how the trial is progressing – perhaps if you are receiving increasing levels of youth drinking or anti-social behaviour in the area associated with the trial, increased complaints about children buying alcohol at the outlet where the trial is taking place or broader concerns about neighbourhood reaction or concerns about the trial. You will be able to send these concerns directly to us at the email address at the end of this guidance document.

At the conclusion of the trials, you may need to review the results and report these locally. They will all be considered by the OPSS Expert Panel on Age Restrictions and information provided on the KHUB knowledge base, in a publicly available area.

What are the conditions of a sandbox?

A proposal put forward must set out how the proposed trial will protect the licensing objectives throughout the course of the test or trial. Although it is accepted that an unsuccessful test or trial may have an adverse impact on the licensing objectives this should be marginal and a test or trial cannot set out to have such an adverse impact.

A proposal must set out how the innovator (and any partners) will cooperate with and secure the support of relevant local responsible bodies, which must, as a minimum include the local chief officer of police, local trading standards authority and local licensing authority. It must also set out how the existing legal requirements, including the age verification mandatory licensing condition, will continue to be met during the trial.

There are other conditions set out in the call for proposals document that we have issued concerning the structure and content of proposals.

What is the timetable for the sandbox?

The call for proposals has been issued on 18 March 2021, with a closing date of 30 May 2021. The proposals will then be reviewed by us together with a sub-group of the OPSS Expert Panel on Age Restrictions (including representatives from Trading Standards, Police and the Licensed Trade).

The operational aspects of the trial must be completed before 30 March 2022, with the reporting completed and published by 30 June 2022.

These are end-dates, rather than target dates. If trials can be completed earlier, then that would be welcome. The outcome reports for all trials will be considered by the OPSS Expert Panel on Age Restrictions with observations also being considered by the Home Office.

How will applications be assessed?

The Home Office and the OPSS will assess applications based on the following criteria:

• Does the application show a truly innovative approach that is capable of furthering knowledge and understanding of how technology could improve or enhance achieving the licensing objectives.
• Has the applicant properly identified, understood and adequately addressed, in consultation with relevant responsible authorities, how it will safeguard compliance during the sandbox trial, how it has secured appropriate enforcement policies and how it will ensure, as far as practically possible, that the licensing objectives are not compromised.
• Has the applicant properly identified, understood and adequately set out mitigation measures for the ethical challenges (including data ethics and vulnerability assessments) presented by the proposed test or trial.
• Are the plans for independent evaluation and publication of the results of the test or trial adequate and appropriate. This is in addition to subsequent evaluation by the Expert Panel on Age Restrictions
• Are the plans for contributing to standards and the future regulatory environment adequate and appropriate.
• Are the timetable, management plans for the test or trial adequate and appropriate.

The total number of sandbox tests or trials active at any one time will take into account the burden on the Home Office, OPSS and local responsible authorities to manage; which may mean that some applications are rejected on grounds of limited resources.

Where can I get queries about the trial answered or submit concerns?

Any local responsible authority with a trial operating in their area will be able to submit concerns or raise queries about the trial directly with us by emailing [email protected].