THE Government is to make the owner of the Millennium Dome rip up its agreement with a foreign gambling company that would have given it exclusive rights to operate a casino in the Dome, The Times has learnt.

The Government intends to bring in rules early next year that would unravel the deal between Anschutz Entertainment Group (AEG), which owns the Dome, and Kerzner International, which operates casinos in the Bahamas and Dubai.

The deal, signed in 2003, stipulates that in the event of Greenwich Council winning a supercasino licence, AEG was committed to working with the Bahamas-based company.

But Tessa Jowell, the Culture Secretary, will insist that whichever council wins the race to have a supercasino must choose the company to run the business using a “fair and open” process, giving equal access to domestic and overseas operators.

This would preclude deals such as the one between AEG and Kerzner, a spokesman for the Department for Culture, Media and Sport confirmed.

The news comes a day after a senior director at AEG fired a shot across the Government’s bows, amid signs of a worsening relationship between the two. David Campbell, the company’s Europe director, said that if AEG was not allowed to open a supercasino on the north Greenwich site, the Government could lose money.

“Our landlord is English Partnerships, which is a government-sponsored agency. Clearly, if we have a bigger project, they get more rent. It’s in everyone’s interest for [the Dome] to be a more developed scheme than a less developed scheme,” he told The Sunday Telegraph. “If we have a tent empty then we will be paying less rent than if we had the whole tent full.”

AEG’s activities have come under intense scrutiny in recent weeks. Philip Anschutz, the company’s owner, regularly met John Prescott and offered him free hospitality on his ranch last year.

Yesterday it emerged that immigration officials from the Home Office have raided the Dome twice since April, most recently last month. They found and detained 19 illegal foreign workers — 16 of them from Eastern Europe. This could further undermine the Dome’s chances of securing the first licence, because the jobs are meant to help local people.

The deal between AEG and Kerzner also came under scrutiny last week at the Casino Advisory Panel hearing into the Greenwich application, where panel members expressed surprise at AEG’s tie up with Kerzner and Greenwich’s apparent acceptance of it. Greenwich Council said that no one else had approached it about opening a casino in the Dome.

Councils were warned by the Gambling Commission this year about the legality of any partnerships. It said that councils should “think carefully before entering into any agreements or arrangements with potential casino operators which might be perceived to affect their ability to exercise their stage two functions objectively and without having prejudged any of the issues”.

The winning council will have to follow a code of conduct, choosing the operator by holding a “regeneration auction”. The casino operator that offers to spend the most on the local area, improving the transport infrastructure and building local entertainments, will be the most likely to secure the contract.

A spokesman for AEG said: “We haven’t been told this, but we accept it is up to Greenwich to select the operator. This is an open process and we believe that we are the only people who have applied so far. We are happy to go through any process, municipal or national.”

Explore UK News

• Crime News

• Education News

• Health News

• Science News

• Scotland News

Times Recommends

• Tree stump 'shows image of Virgin Mary'
• BBC drops Strictly judge for younger model
• Trafalgar Square 'reduced to a spectacle'