PRESENTATION TO PORTFOLIO
COMMITTEE ON TRADE AND
INDUSTRY
CHALLENGES IN GAMBLING
Date: 2nd February 2010
Delegates from the National
Gambling Board (NGB)
Prof L de Vries (Board Member) 0836337395
Ms N Maseti (Board Member) 0828252702
Ms MAF Moja (ACEO) 0832693907
Mr T Marasha (COO) 0832693931
Adv T Polaki (Board Secretary) 0832693947
Office No: (012) 394-3800
The purpose of our presentation is to
highlight legislative impediments that
the National Gambling Board encounter
in executing our regulatory mandate by
implementing the NG Act No 7 of 2004,
and request the Portfolio Committee to
consider them in the process of
reviewing the National Gambling Act
Proposed areas of improvement to enable
effective enforcement of gambling in South
Africa
• ESTABLISHMENT OF A GAMBLING TRIBUNAL
- GAMBLING MATTERS DO NOT ENJOY PRIORITY IN
ORDINARY COURTS
- GAMBLING ISSUES ARE COMPLEX AT TIMES AND NOT
EASILY UNDERSTOOD BY ORDINARY COURTS
- NATIONAL LAW ENFORCEMENT AGENCIES AT TIMES
HAVE OTHER MATTERS TO ATTEND TO OVER AND
ABOVE GAMBLING
• GAMBLING INSPECTORS TO HAVE PEACE OFFICERS
STATUS/AUTHORITY.
CONCURRENT LEGISLATIVE COMPETENCY
(National and Provinces)
- Process of amending legislation by Provinces is
unilateral
- Unilateral provincial process in some instances result
in provincial legislation conflicting (or not uniform
with) National Act eg. EBT’s; (Electronic Bingo
Terminals); CEMS; (Central Electronic Monitoring
Systems; Categories of Licenses; etc.
- Resolutions taken by THE National Gambling Policy
Council (NGPC) are taken as administrative decision
without mechanism to enforce implementation or
monitoring.
GAMBLING AS A CONCURRENT LEGISLATIVE
COMPETENCY – (CONTINUED)
-
INDIVIDUAL PROVINCIAL LIMITED
PAYOUT MACHINE (LPM) POLICIES WHILE
NGB HAS TO APPLY UNIFORM
STANDARDS IN APPROVING 40 MACHINE
SITES.
CATEGORIES OF GAMBLING MODES
CASINO’S
A WELL REGULATED REGIME THAT HAS
BROUGHT THE SOUTH AFRICAN INDUSTRY
AN INTERNATIONAL REPUTATION
• NO LIMITS ON QUOTAS OF GAMBLING
MACHINES & TABLES THUS INCREASE OF
MACHINES & TABLES WITHOUT “SOCIOECONOMIC STUDY”
BINGO
• FORMULATION OF DETAILED BINGO POLICY
- TECHNOLOGY ADVANCEMENT BROUGHT NEW
ANGLE OF BINGO ACTIVITIES
• NO LIMITATION ON NUMBER OF LICENCES
AND QUOTA PER PROVINCE
• INCONSINTENCY BETWEEN CASINO AND
BINGO LICENSING CRITERIA WHEREAS THEY
COMPETE FOR THE SAME MARKET.
LPM’s
• PROVINCIAL LICENSING OF CEMS OPERATOR WHILE
CEMS IS NGB’s RESPONSIBILITY
• INCONSISTENCY BETWEEN MUNICIPAL BY-LAWS &
GAMBLING LEGISLATION I.R.O. LPM’s (eg. BUSINESS
LICENSES; PROXIMITY OF BUSINESS SITES, ETC.)
• INCONSISTENCY BETWEEN PROVINCIAL BUSINESS
ACT REQUIREMENTS AND GAMBLING LAWS WITH
REGARD TO LICENSING OF MACHINES.
RACING AND BETTING
“It has been our understanding since 2004 that,
horseracing activities are broadly provided for in
the Act, and thus would require detailed
amendments at some stage particularly regulation
of the sporting authority”
THIS IS TO MAKE THE PORTFOLIO COMMITTEE
AWARE THAT WE STILL NEED TO DEVELOP
ENCOMPASING POLICY ON REGULATION OF RACING
AND BETTING ACTIVITIES
RACING
The racing element refers to direct activities relating
to horseracing eg. Breeding; handicapping; jockey
etc., and are regulated by the National Horseracing
Authority (NHA).
BETTING
The betting element refers to activities relating to
wagering eg. stakes; type of bets; rules of betting;
etc., and are regulated by gambling regulators.
Unlike other types of sport eg. Soccer and
contingencies eg., outcome of elections, gambling
regulators are involved in horseracing for the
following reasons:
- Horseracing is dependent on betting
- racing tracks are funded from betting funds (pool
funds)
- racing tracks are funded from betting taxes.
These are the public funds which would have been
paid out as winnings (pool funds) or national
benefits (government taxes)
RACING AND BETTING
ROLE OF GAMBLING REGULATORS
• Determine gambling taxes (currently 6%)
• Determine portion of taxes payable to racing
companies to fund racing shows (currently
3%)
• Approve betting rules
• Approve stakes (wagering money)
• License operators offering betting activities
(Totalizators and Bookmakers)
RACING AND BETTING
Role of National Horseracing Authority (NHA)
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MAINTENANCE OF STUD BOOKS
LICENSING AND REGISTRATION OF CRITICAL AREAS
FORMULATION OF RULES ON SPORT AND BREEDING
MONITOR OF TRAINING AND RACING
OPERATION OF LABORATORY
OPERATION OF DISCIPLINARY SYSTEM
RECORDING & PUBLICATION OF DATA ON SPORT
HANDICAPPING OF HORSES
OVERSEEING TRAINING OF APPRENTICE JOCKEYS
AREAS THAT NEED REVIEW
• Regulation of National Horseracing Authority (NHA)
with it’s critical role
• Policy on other forms of animal racing, eg.
Greyhound racing
• Open bets vs fixed odd bets i.r.o. bookmakers and
tote
• Virtual Racing
• National certificate of suitability to be provided for
other 3rd party operators in the industry eg.
suppliers of parts to gambling equipment
AREAS THAT NEED REVIEW
(continued)
• Conflicting areas between gambling laws
and broadcasting laws eg. The extent to
which gambling activities are
broadcasted (poker tournaments) that
may be viewed as inducing gambling in
the country
FAFHEE
• ECONOMIC IMPACT NOT KNOWN SINCE NO
STUDY WAS CONDUCTED
• DEFINITION OF LOTTO AND GAMBLING
GAMES SEEN TO INCLUDE FAFHEE BUT NOT
WELL ENOUGH TO BE REGULATED BY EITHER
• SOCIO-ECONOMIC STUDIES REPORT THAT THE
FAFHEE GAMES CONTRIBUTE TOWARDS THE
INCREASE OF IRRESPONSIBLE GAMBLING IN
THE COUNTRY
FINDINGS OF SOCIO-ECONOMIC IMPACT STUDY
2009
• PROBLEM GAMBLING WAS STABLE AT 5% SINCE 2006
STUDY
• SOUTH AFRICA HAS REPUTABLE AND WELL
REGULATED REGIME
• BREADWINNERS WERE MOST AFFECTED
• UNEMPLOYED MALES AGED 16, 30 AND 35
PARTICIPATE IN ILLEGAL GAMBLING
• INFORMAL GAMES (FAFHEE, CARDS & DICE) PLAY A
BIG ROLE IN PROBLEM GAMBLING
FINDINGS OF SOCIO-ECONOMIC IMPACT STUDY
2009 (CONTINUED)
• POKER AND ON-LINE GAMES WERE
IDENTIFIED AS A BIG GAMBLING PROBLEM
• LOTTERY GAMES INCREASED PROBLEM
GAMBLING THOUGH REDUCED DUE TO
INTEREST LOST WHEN THERE WAS NO
LOTTERY
• NOVELTY VISITS TO CASINOS DECREASED BUT
REGULAR GAMBLERS INCREASED THEIR VISITS
FINDINGS OF SOCIO-ECONOMIC IMPACT STUDY
2009 (CONTINUED)
• CASINO GAMBLING REPRESENT 18% OF
GAMBLERS AND LOTTO IS 84%, BUT CASINOS
ATTRACT 76% OF ALL GAMBLING MONEY
• SOME GAMBLERS WERE EXPOSED TO
GAMBLING FROM AN EARLY AGE BY OWN
PARENTS PLAYING IN-HOUSE GAMBLING
GAMES. OTHERS RECOMMEND GAMBLING
AGES TO BE RAISED TO 21 YEARS
FINDINGS OF SOCIO-ECONOMIC IMPACT STUDY
2009 (CONTINUED)
• GAMBLERS FIND IT DIFFICULT TO BUDGET
GAMBLING EXPENDITURE AND THEREFORE
CANNOT CONTROL THEIR GAMBLING HABITS.
• MAJORITY (73%) OF GAMBLERS CONFIRM
THAT THEY ARE AWARE OF THE NATURE AND
RISKS OF GAMBLING
• OVERALL RESPONDENT’S VIEW IS GAMBLING
IS OUT OF CHOICE AND ADVOCATE FOR
FREEDOM OF CHOICE
INTERACTIVE GAMBLING
- The following areas need to be re-opened for
debate once policy decision has been clarified
regarding Interactive Gambling
• TAX RATE OF 6%
• MAXIMUM CREDIT IN PLAYER ACCOUNTS
• PLAYER REGISTRATION – NO TRANSACTION BEFORE
REGISTRATION
• E-WALLET (not fully addressed in the legislation)
• ADVERTISING – TV Broadcasting of gambling (not
fully addressed in the legislation)
THANK YOU!