A district judge has upheld a decision by Scarborough Borough Council to allow Apollo Resorts and Leisure to proceed to the next stage of the process to award a new casino licence.

Nikolas Shaw Ltd, the operator of the town’s existing Opera House Casino, is also vying for the small casino premises licence and had wanted its rival excluded on procedural grounds. The company claimed that Apollo was granted time to alter its plans during the first stage of the application process - something it said should not have been permitted under the 2005 Gambling Act.

However, following the judge’s decision, both are now free to proceed to the second stage where they will be asked to present the merits of their proposals.

"It is in the interests of the residents of Scarborough to begin stage two of the ‘competition’ process where both applicants will be expected to demonstrate how they will contribute to the wellbeing of the area," said the council’s licensing manager, Una Faithful.

Nikolas Shaw Ltd’s bid includes plans to extend the Opera House Casino, which is located in the town centre, while Apollo - which is also in the running for new casino licences in other areas of the UK - is aiming to develop a new property in the North Bay area.