South African government sets its face against online gambling

After over a decade of political dithering, surveys, commissions and fact-finding jollies, the South African government has decided against legalising online gambling, according to a final policy document released (appropriately) on April Fool’s Day this year by the Department of Trade and Industry.

The document indicates that the government’s main objection to online gambling is that it is not sufficiently labour-intensive to create jobs, and it presents a competitive danger to the land casino industry in the country, which does deliver employment.

Online sports betting as presently permitted will be allowed to continue, but no other online activity will be legalised, and anti-illegal online gambling enforcement is to be stepped up through amendments to the National Gambling Act which will compel Internet Service Providers to block access to illegal online gambling websites, and prohibit financial institutions from processing illegal online gambling transactions.

The scandal-ridden National Gambling Board has been replaced as the National Gambling Regulator, which will have enforcement responsibilities relating to the ISP and bank-related measures in collaboration with the national police where criminal activity through non-compliance is found.

The Department intends to deal with the lack of action against illegal online gambling operators by tasking the National Gambling Regulator with increased staffing at provincial level to improve enforcement capacity.

If that is insufficient, the document suggests the rather draconian introduction of an “independent” tribunal to enforce illegal gambling penalties. That would be funded by government and levies on existing South African operators, boosted by the fines income it might generate from illegal operators and/or non-compliant banks and ISPs.

Another, and very player-centric, sanction in the document targets online players who frequent illegal online gambling websites and win. Such winnings will be regarded as illegal profits which may be seized without the oversight of a High Court order and paid into a new Unlawful Winnings Trust. The document does not go into too much detail on the Trust and who will be responsible for it.

It all smacks of taking a sledge hammer to crack a walnut.

http://www.thedti.gov.za/gazzettes/Gambling_Policy2016.pdf