South Africa raises the stakes for online gambling operators

South Africa johannesburg
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South Africa’s Department of Trade and Industry (DTI) has presented its proposals for a new national gambling policy which will extend government agencies’ powers to clamp down on unregulated online gambling.

The measures put forward in the DTI’s policy paper, National Gambling Policy 2016, aim to address issues with the effectiveness of the earlier National Gambling Act, 2004.

“South Africa is not following global trends in iGaming and is legislating against it, but I believe that online gambling is the way of the future and needs to be regulated,” said Abigail Ronald-Louw, a South Africa-based attorney specialising in gambling law.

The policy will see the creation of a new regulatory agency with the National Gambling Board repurposed as the National Gambling Regulator with a mandate to oversee and penalise ISPs and banks along with players who engage in online poker and other forms of gambling.

The policy also proposes that an independent tribunal be established in order to relieve South Africa’s overburdened police and court resources. This would be funded by government grants, levies on domestic gambling operators and the fines collected from illegal operators.

“There are concerns in South Africa around the culture of gambling that’s built up over time and the government thinks that if it bans online gambling it might be a step towards achieving an overall reduction,” added Ronald-Louw. “However, I disagree with this – as a lawyer I know how long it takes to get anything done if you try and enforce a ban using the police and the normal courts.

“The concept of an independent tribunal is a brilliant idea but at the moment it’s difficult to see how it would work practically. The best place to start would be the banks: all online transactions utilise a credit card and the way to monitor this would be working with financial institutions.”

South Africa has been a grey market for some time, and while online gambling is illegal, the 2008 National Gambling Amendment Act permitted it if an operator held a license with the DTI.

However, a 2011 High Court ruling in the legal battle between Swaziland- based online gambling operator Piggs Peak and the Gauteng Gambling Board established a new precedent which overturned the licensing provision and once again prohibited online gambling.

Until now, the government has primarily pressured individual online gamblers rather than the operators but if the new policy is adopted by the legislature it is difficult to see how the major online gambling sites that currently operate services in South Africa could continue to do so.


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