Newham LBC has attacked industry regulators the Gambling Commission for a lack of support, after a court overturned the council's decision to prevent the opening of a Paddy Power betting shop.

Newham already has more than 80 betting shops, the third highest in London, and rejected giving Paddy Power an operators licence on the grounds it would encourage crime and anti-social behaviour.

However, in what is seen as a test case over the proportion of business generated by gaming machines within bookmakers' premises, Thames Magistrates' Court has ruled against the council.

‘Ministers fail to understand how the legislation is toothless in dealing with the clustering of betting shops and the proliferation of high stakes gaming machines,' said Cllr Ian Corbett, Newham's executive member for environment.

Cllr Corbett said the council was ‘deeply disappointed' with the judgment and said Newham would study the verdict closely to see whether a judicial review was merited.

‘Taking legal action at a time when our services are under severe pressure is something we have been forced to do because the Gambling Commission refuses to act as a regulator,' Cllr Corbett added.  ‘It is time the regulator did its job.'

He said the case exposed a serious problem in that current laws cannot prevent high street bookmakers deriving increasing revenues from high stakes B2 gaming machines.