corporate commercial ENSight | 26 November 2010

online gambling remains unlawful in south africa

by the corporate commercial department

On 24 August 2010, the North Gauteng High Court handed down judgment in the case of Casino Enterprises (Pty) Ltd (Swaziland) v Gauteng Gambling Board and others, which the media sensationalised by incorrectly suggesting that the result of the judgment was that online gambling had been declared unlawful in South Africa. On the contrary, the judgment confirmed the current legal position in South Africa, which is that online gambling (or interactive gambling, as it is described in the legislation) is not permitted in South Africa.

It is necessary to clearly distinguish between interactive gambling on the one hand and online sports betting on the other. The making available of online sports betting activities constitutes the business of bookmaking and is lawful in South Africa, provided that the person conducting such business holds the necessary provincial bookmaker’s licence(s). The Casino Enterprises judgment does not have any impact on the lawfulness of licensed online sports betting activities in South Africa.

As regards interactive gambling, the National Gambling Act, 7 of 2004, prohibits the making available of and engaging in interactive games (being gambling games made available and accessed via the internet, other than the activities of bookmakers). In other words, it is unlawful for operators to make available and advertise interactive gambling in South Africa, as well as for players in South Africa to engage in interactive gambling (irrespective of whether the operator making available the games is licensed in another jurisdiction (e.g. Swaziland, as was the case in the Casino Enterprises judgment).

The National Gambling Amendment Act, 20 of 2008 ("the Amendment Act") was published in July 2008 and seeks to legalise interactive gambling in South Africa. Once in force, the Amendment Act will establish measures to control the currently unregulated interactive gambling market in South Africa. At present, however, the Amendment Act is not in force, largely due to the objections of various interested persons, including land-based casinos and anti-money laundering authorities.

Although the Casino Enterprises judgment did not change the current legal status of interactive gambling in South Africa, the National Gambling Board indicated that it hopes that the judgment will alert unlicensed interactive gambling operators and individual punters engaging in interactive gambling in South Africa and remind them that even though the Amendment Act is in the pipeline, interactive gambling remains unlawful in South Africa.

In the mean time, we wait in anticipation to hear when the Amendment Act will come into force.

No information provided herein may in any way be construed as legal advice from ENSafrica and/or any of its personnel. Professional advice must be sought from ENSafrica before any action is taken based on the information provided herein, and consent must be obtained from ENSafrica before the information provided herein is reproduced in any way. ENSafrica disclaims any responsibility for positions taken without due consultation and/or information reproduced without due consent, and no person shall have any claim of any nature whatsoever arising out of, or in connection with, the information provided herein against ENSafrica and/or any of its personnel. Any values, such as currency (and their indicators), and/or dates provided herein are indicative and for information purposes only, and ENSafrica does not warrant the correctness, completeness or accuracy of the information provided herein in any way.



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