The UK prize draw competitions market is undergoing significant transformation, shifting from a fragmented collection of small operators to a more consolidated and professionally governed sector, an updated white paper from consultancy Rokker has reported this week.
According to Rokker’s report, M&A spending in the sector has surpassed £220 million to date.
In its initial April coverage, Rokker stated the UK prize draw market was worth £1.3 billion in annual revenue, with 7.4 million active players and over 400 active operators in the market.
The white paper identified 14 notable B2B platform providers supporting the sector, and estimated that over 1,000 operators are actively running prize draw competitions, a sharp increase from the 401 operators identified in government research of 2023.
Only 195 prize draw operators signed up to voluntary code
Of these, roughly 195 operators had signed the newly introduced Voluntary Code of Good Practice as of late July 2026, supplemented by 31 service providers labelled as “other relevant signatories”.
Signatories represent less than 20% of the sector’s estimated active operators, highlighting partial uptake.
Launched on 20 May 2026, the voluntary code was put in place by the government’s DCMS as a means of self-regulation across the sector, as for now prize draws do not fall under the remit of the Gambling Act 2005, and are therefore not overseen by the Gambling Commission.
Legal experts have previously highlighted the code as a positive action for operators to improve their reputation and prepare for potential M&A and future regulation, as buyers would carry out regulatory due-dilligence.
Rokker also acknowledged that operators adhering to the code are being perceived as more attractive acquisition targets due to their established compliance infrastructures.
Voluntary code membership fees are tiered by turnover: £24,000 per annum for operators exceeding £50 million UK turnover, scaling down to £250 for those under £2 million, while associate service providers pay £2,500.
The acquisition playbook
Prominent transactions that have contributing to consolidation in the sector included Winvia’s acquisitions of Best of the Best (£45.3 million, 2023), Click Competitions (£16.4 million, 2025) and Rev Comps (£11.8 million, 2026), alongside Jumbo Interactive’s purchases of Dream Car Giveaways (£65.8 million) and Dream Giveaway USA (£28.3 million) in October 2025.
More recently, ZEAL Network acquired SevenCanyon and related businesses for £38.6 million in July.
The move marked Zeal’s entry into the UK, which it described as Europe’s largest for digital prize draw products. SevenCanyon operates a portfolio of established UK digital prize draw websites such as 7days Performance, Redline Competitions and UK Carp Competitions.
An expansion of affiliate and directory sites sending players to prize draws operators was also noted, with tracker sites cataloguing operator data, ticket sales and odds. However, this affiliate layer remains nascent compared to regulated iGaming, with limited transparency around operator relationships and payment structures.
Rokker has predicted that sustained consolidation within the market is being propelled forward by well-capitalised players adopting both acquisition and organic growth strategies.
Smaller operators that do not invest in a compliance infrastructure or tax mitigation may have to seek out an exit strategy due to intensifying regulatory and commercial pressures.
According to Ben Gale, partner at Qualstels, the implementation of the code has formed the basis of a buyer’s regulatory benchmark.
“Buyers are using the voluntary code as a ready-made framework to assess whether a business is genuinely prepared for greater scrutiny”, he said in a recent op-ed on iGB.
He also added that the recent establishment of the Prize Competition Council trade body has “added a further layer of institutional maturity”.
Operators considering tax tribunal against HMRC VAT clarification
Recent uncertainty for prize draws has been HMRC’s public clarification in February 2026 that paid-entry prize draws offering a free-entry alternative are not eligible for the VAT exemption applicable to some games of chance.
HMRC asserted that such paid entries should be charged VAT at the standard 20% rate and raffles must be backdated with historic VAT included in upcoming tax bills.
Rokker reported that HMRC has sent letters prompting operators to reassess historic VAT positions. At least one major operator is formally contesting HMRC’s position through a tax tribunal. Hearings are scheduled for autumn 2026 with a decision expected by spring 2027.
DrawHouse, a B2B prize-draw platform, believes that the reinterpretation of VAT rules could reduce operator margins by as much as 25% to 30%. It could also expose businesses to sizeable retrospective tax bills.
The emergence of the tax uncertainty and potential for future regulation are factors impacting deal valuations and terms.
For example, ZEAL Network reportedly paid a lower multiple for SevenCanyon after factoring in potential VAT liabilities and securing insurance-backed indemnities for historic tax exposures.
According to Rokker, firms with strong legal, tax and technology capabilities stand to benefit from this environment. They can manage regulatory risk more effectively and pursue “buy and build” roll-up strategies.
Kathryn Evans
Kathryn covers bitesize breaking news with a primary focus on EMEA and US legislation. A proud North Walian, fluent Welsh speaker and lifelong Wrexham FC fan – long before Hollywood came calling.
Original article: https://igamingbusiness.com/lottery/prize-draws/rokker-whitepaper-only-20-of-uk-prize-draw-operators-have-signed-voluntary-code/
