South Africa to Welcome Online Gambling

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It seems that South Africa chooses regulation instead of prohibition.

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By Owen B | Mar 17, 2008

A bill to regulate online gambling in South Africa has advanced last week and seems headed to approval. South Africans may very well be able to gamble online one day soon.

The current law - the National Gambling Act, Act 7 of 2004 - forbids any such activity. South Africans are not allowed to play casino games or bet online, even if the website operator is located outside the country. As for licenses to operate within South Africa, none such were ever granted.

In fact, gamblers face prison sentence and massive fines for gambling. Of course the current legal state also means that players have no protection from corrupt websites. Licenses, which will follow legalization, will lead to independent and state protection agencies, said Themba Marasha, chief operations officer of the National Gambling Board.

Gambling Today
The number of gamblers in South Africa is unknown. They bet at sites based outside the country. The most popular of them SilverSands, Piggs Peak and African Palace Casinos.

The legal state of gambling has a company challenging the ban on gambling in court, which in iteslef may have motivated the reform that seems upon us.

What's Next
Now that the Bill passed to the Select Committee of National Provinces, before moving on to the National Assembly for final approval, a change may indeed come. Online gambling sites will be allowed to freely operate (although under restrictions and regulations) and advertise their products.

Internet gambling operators will simply have to meet the requirements of South African national technical standards.

 

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Update

SOUTH AFRICA: ONLINE GAMBLING REGULATION DELAYED AGAIN

Regulation hangs in the balance as political arguments continue

The much-delayed regulation of online gambling in South Africa has been held up once again, this time by a debate over online gambling advertising which must be resolved before amendments to the National Gambling Amendment Bill can go forward in Parliament.

The advertising issue is rooted in an amendment to the Bill made by the the National Council of Provinces (NCOP) which included an outright prohibition on the advertising of online gambling, reports IT Web.

In the latest development, the bill was introduced into Parliament last year (see previous InfoPowa reports), and would have amended the National Gambling Act of 2004 to regulate interactive gambling, defined as betting over the Internet or mobile phones. The implications of regulating online gambling have been exhaustively and internationally researched and examined by the government in past years.

Gambling is big business in SA, reports IT Web, with gross gambling revenue (GGR) approaching SA Rands 14 billion (around $2 billion). The National Gambling Board defines GGR as turnover less winnings paid to players.

Current legislation bans all forms of organised gambling unless licensed. At present, only terrestrial casinos, bingo parlours and betting associated with horse racing are legal and licensed. Most are keen to enter the interactive gambling market once regulated.

Many South Africans are already gambling online and a number of vendors have set up shop in neighbouring countries to service that market.

Veteran ANC lawmaker professor Ben Turok says the National Assembly's trade and industry committee last month took a decision not to proceed with the Bill as the committee believed that it would allow young people to gamble from home and we are opposed to that.

Democratic Alliance Member of Parliament Les Labuschagne says the committee believes there is no hurry to enact the legislation. He adds that some MPs on the portfolio committee are opposed to gambling and casinos in general, but have to abide by the law.

Both the National Assembly and NCOP are also opposed to the advertising of online gambling, but the Department of Trade and Industry (DTI), which sponsored the original law and its amendment, says it would be unconstitutional to ban advertising for online gambling but not for conventional gambling.

Labuschagne says the committee has now set the Bill aside to hear and consider DTI input on the advertising question.