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Postitive spin-offs from legal online gambling


The legalisation of online gambling in South Africa could bring positive spin-offs to the country, including job creation.
This is according to Tasoulla Hadjigeorgiou, CEO of online fixed odds betting site LottoStar, who says: “In South Africa, online – also known as remote – gambling is illegal, with the only exception being for bookmakers who are authorised to use online platforms to take bets on events whereby the outcome is beyond the control of the web site and its administrators. For example, at LottoStar, the company takes bets on the outcome of international lotteries and games.”
A draft Remote Gambling Bill of 2014, tabled by the Shadow Minister of Trade and Industry, DA MP Geordin Hill-Lewis, has been published in the Government Gazette and was open for public comment until May this year. The bill seeks to provide a uniform structure to the norms of online gambling in the country through the provision of up-to-date regulations that are consistent with global norms.
However, in response to this proposed bill, the Department of Trade and Industry (dti) has noted in a statement that online gambling is too unregulated and unsupervised to repair, stating that it brings with it “significant social ills”.
Hadjigeorgiou believes that this outlook is not necessarily the correct way to review the situation, commenting: “In the digital age where services such as gambling are going online, there has been a significant boom in online gambling markets internationally. This has presented the argument that current legislation is limiting the opportunity for South African gaming companies to tap into more streams of revenue.”
The Shadow Minister of Trade and Industry is on record as stating that, because online gambling is happening in South Africa, regardless of its current illegality, it would be more desirable to legalise remote gambling so that it can be regulated and, in addition, generate tax revenue and boost job creation.
Hadjigeorgiou says: “Although classified as an unregulated market, it is in itself regulated. There are laws and regulations which must be bet by the bookmaker and regular audits of both the software and operating functions of the bookmaker are carried out by the Gambling Boards. The Gambling Boards are already geared and capable.”
Some of the aims of the bill would be to provide for uniform norms and standards in respect of remote gambling; to prevent minors and vulnerable persons from being exposed to the possible negative effects of gambling; to ensure compliance with the Financial Intelligence Centre Act (FICA) and to protect the public and licensed remote gambling operators from fraud and criminal behaviour.
“Some of the proposals that the bill has put forward include ensuring that online gambling companies open local offices and call centres if they want to play in the South African space,” says Hadjigeorgiou. “The bill also seeks that provinces and the National Gambling Board licence these operators. These measures would result directly in job creation prospects.”
The bill also proposes safety measures whereby users can check if the online gambling sites that they are using are legal and registered, as occurs in the UK under the auspices of the UK Gambling Commission.
“We have noted the influx of illegal online gambling in South Africa,” Hadjigeorgiou adds. “The Casino Association of South Africa (CASA) has said that in 2014, illegal gambling cost the country an estimated R110 million in lost gaming tax revenue. We believe this tax allocation could have been used in the delivery of much needed services in the country. In addition, the regulation of online gambling could bring positive spin-offs in the form of consumer protection, regulation and job creation.”