The South African parliament is enacting a new piece of gambling legislation, after the original legislation led to uproar from a wide range of people and groups. This means that the controversial aspects of the bill will not be brought in until sometime in the future.

The parliamentary committee for Trade and Industry in South Africa enacted the National Gambling Amendment Act of 2018 on 21 November. They did so after narrowing the focus of the bill to only three issues, so that it could pass through the legislature without any hiccups.

The new version

According to Jean Marie Fubbs, the chairperson of the committee, they decided to ditch the more extensive legislation for the moment, supported by the Department of Trade and Industry. Now the three key issues this new act addresses resolve its existing challenges in the governance process.

Firstly, a new body called the National Gambling Regulator will assume responsibility for oversight and regulatory authority, taking over from the National Gambling Policy Council.

Secondly, improvements will be made to the current governance systems and there will be a broadening of the National Central Electronic Monitoring System, which helps monitor all types of gambling activity. This will in turn help create market data that is more efficient as well as help to create better tax levels.

Thirdly, some of the items that were subject to removal from the original legislation include the ban on dog racing, the regulation for electronic bingo machines and getting rid of the ability to place bets on lottery results.

The amended act also got rid of the major online gambling payment crackdown, which according to the committee, was because “the time available would not have allowed for an effective interrogation of these matters”.

These issues will not be going away forever. Fubb has indicated that the revised act will simply be a stepping stone for more comprehensive changes to the regulatory framework of the gambling sector in the future.

The current environment

At the moment, online racing and sports betting are legal in South Africa.

However, the original act was pushing for very strict punishments for any of the offshore gambling operators that were targeting South African residents without having a license in the locality. This included platforms that offer online poker or casino options, both of which are completely illegal in the country.

A policy was also set to be enacted whereby the authorities would confiscate winnings from residents who use these illegal platforms.

The South African gambling laws are still somewhat behind the times. Politicians have made recent attempts to update and broaden the scope for online gambling in particular.

This would include legalizing online poker and online casinos. However, to date, little progress has been made on the issue, largely because of the lobbying efforts of the offline casino industry.

Why was the original bill so controversial?

Africa is seeing a massive increase in the levels of gambling activity. It is a market that is largely untapped and holds a lot of potential. South Africa is one of the main drivers of this.

However, the original version of this act would have undermined the sector and inhibited a lot of this positive growth. By tightening up regulations across the board, this could lead to African betting markets stalling. Other countries could start to implement similar measures.

While the South African government understands that many aspects of this act are controversial, it is conceding only a temporary defeat.

It will push through the measures to help stabilize the sector, but future changes will only stifle it. This interesting debate is likely to rage on until the time comes to revisit the issue in the legislature.