South African Online Gambling Law

When it comes to online gambling in South Africa, where do you - the player - stand? We review the Gambling Act and show what the future holds for gambling in SA.

December 10, 2014 -- Updated 0842 GMT

Until relatively recently, online gambling law was quite a grey area in South Africa. The main reason for this was that the relevant laws and statutes covering gambling were not up to date in terms of these new forms of gambling made possible by the Internet. So online gambling and poker became popular among South Africans. The most well-known "local" online casino, Piggs Peak (situated in the neighbouring territory of Swaziland), offered both online casino gambling and online poker to South African players. It flourished for a good few years.

Then the situation changed, as the spotlight fell on this hitherto effectively unregulated industry.

Recent online gambling law

The South African government promulgated the National Gambling Act of 2004, which made it illegal to engage in what it termed "interactive gambling services" and the offering or advertising of these services for South Africans. By "interactive" the law refers to Internet games. This covers both casino games and poker games, whether offered by operators inside South Africa or outside of its borders. But there is an important distinction that is identified.

While online casino and poker games were made unlawful, online sports betting and online horse race betting were specifically made legal. This is as long as the operator is fully licensed by one of the South African provincial gambling licensing boards. So, for example, the most popular South African sports betting website, SportingBet, is fully licensed by the Western Cape Gambling Board and operates completely legally inside the country. It is used by thousands of sports bettors every day.

In the meantime, however, Piggs Peak continued to offer both online casino and online poker, effectively under the impression that online gambling offered from an offshore location was not adequately covered in the Gambling Act. They took this all the way to the North Gauteng High Court in an effort to get a legal stamp of approval on their services, but were ultimately unsuccessful and were forced to bar South Africans from playing.

In concert with this, South African banks do not allow bank accounts and credit cards to be used to transfer funds to online casinos. However, it is still possible to do so using online banking methods such as NETeller or uKash, etc.

Proposed online gambling legislation

At the same time it was – and still is – recognised that online gambling is a huge industry that attracts many South Africans, and that the problem is not so much one of whether it should or should not be legalised, but more one of how to regulate it. To this end the National Gambling Amendment Act of 2008 was drawn up with a view to bringing it before Parliament in order to have online gambling legalised and regulated. The amendment attracted a lot of opposition from land-based casinos, for many of the same reasons as the situation in America, where these casinos feared losing customers and revenue to their online competition. The fact remains, thought, that there is currently legislation on the books and quite possibly in the pipeline that will make online gambling legal for South Africans.

The current situation for players

While the above is quite clear, there are of course plenty of overseas online casinos that offer online gambling to South Africans, and online payment methods that can be used. And there remains every possibility that online gambling will soon be legalised in the country, once the National Gambling Amendment Act of 2008 goes through Parliament and is signed into law.

Of course sports betting is fully legal for South Africans. At the moment betting on horse racing predominates, but as more sports betting websites emerge and broadband and mobile Internet access increases, this is likely to change, with a swing towards sports betting. South Africa is, after all, a sports mad nation.

Companies like PwC expect gambling activities and revenues to continue to grow, indicating that the country's appetite shows no sign of waning. And in the face of this, the legalisation and regulation of online gambling looks likely to follow shortly. This is especially buoyed by the realisation that in South Africa, as in the rest of the world, the most important factors are safe access and responsible gambling. Given that South Africans have ways of circumventing the laws, this becomes even more of an imperative.

In light of the widespread availability of online gambling and the Internet's ability to make national borders permeable, it appears to be in everyone's interests for the National Gambling Amendment of 2008 to become law, so that the industry can operate transparently, safely and responsibly for South African players. It has been reported by PwC that the South African government had plans to issue ten online casino gambling licences in the period around 2009, but this has obviously not happened yet. We await the next roll of the dice…

References

  1. Gambling in South Africa - Wikipedia
  2. NGB Interactive Gambling Regulations
  3. PWC Gambling Outlook
  4. Legal Status of online gambling in South Africa
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