African Regulatory Landscape – iGB

## African Regulatory Landscape – iGB

Yahaya Maikori, the founder of Law Allianz, analyzed the current and emerging regulations for gaming in several key African nations.

Gaming is gaining popularity in Africa, prompting governments to revise their laws, particularly for online and mobile gaming. It’s crucial to mitigate the negative consequences associated with gambling addiction and debt. This is a concern due to poverty, but it also highlights the potential for governments to generate revenue through the gaming industry.

Gaming isn’t a new phenomenon in Africa, but online games and novel game formats pose significant challenges for many nations. Previously, regulations were primarily focused on lottery betting, slot machines, and perhaps lotteries. In the past, gambling wasn’t perceived as a legitimate industry. These games were merely small enterprises operating on street corners.

Despite this, the emergence of technology, the web, and online commerce has entirely changed the sector, making it a multi-million dollar industry that affects every part of our lives, leaving authorities struggling to create a functional regulatory system. In most African regions, permits are still issued by tax agencies without any supporting legal or regulatory framework.

Although extensive discussions are still ongoing across the continent, here is a brief overview of the current state of legal and regulatory changes in some major markets.

As the sector expands quickly, the concerns of most regulators are clear.

Even with their best efforts, the cost and process of passing laws and regulations are not only costly but also time-consuming, especially when dealing with key stakeholders who often have little understanding of the challenges presented by gambling. Additionally, in some nations, the industry has been unnecessarily politicized and stigmatized, pushing it to the back of national priorities. Luckily (or unfortunately), with the help of the media, gambling can no longer be contained. It has become part of our mainstream economic activities and is starting to receive the attention it deserves.

Nigeria

The National Lottery Regulatory Commission, established in 2005 by an Act of Parliament, has faced challenges in its mandate due to the Nigerian Constitution’s provision granting the 36 states the authority to independently regulate gambling within their respective territories.

In 2016, the Vice President, Yemi Osinbajo, decided to postpone signing the National Lottery Act (Amendment) due to a legal dispute concerning the National Assembly’s power to legislate on the matter. Despite this legal hurdle, several states at the national level continued to follow the lead of Lagos State, which has been a pioneer in gambling regulation in Nigeria.

Oyo State enacted the Oyo State Gaming Law last year, while Anambra State has a revised gaming bill under consideration by the State Assembly, aiming to replace its 2005 Gaming Law. Meanwhile, Lagos State has proposed a bill to repeal the 2004 Lagos State Lottery Law and combine it with the 2007 Casino and Gaming Law into the Lagos State Gaming Regulatory Agency Law. Key features of this proposed legislation include provisions for remote gambling, advertising, social responsibility measures, and the authority to appoint inspectors. In the meantime, the National Lottery Regulatory Commission has established a committee to collaborate with state regulators to address the apparent inconsistencies between their respective jurisdictions.

Botswana

Botswana, a small nation in Africa, is widely regarded as having a model system for gambling regulation.

Following the implementation of the Gaming Act in 2012 and the Gaming Rules in 2016, no further legislation has been put into effect.

The granting of permits for other sectors has considerably slowed down since the use of expressions of interest and authorization applications for license issuance. The auction of the national lottery license was deemed a top priority, but it has become entangled in a drawn-out legal battle with no clear resolution. The involved parties are currently preparing to appeal the process, two years after the bidding concluded.

In the meantime, the Gaming Authority has announced public hearings for two casino licenses – one for the transfer of a license to a new operator and another for a fresh application. Despite the widespread popularity of sports betting, the Authority has yet to issue any sports betting licenses, despite stating their intention to do so. If and when this occurs, the competition will be fierce, as the world’s leading brands will be vying for one of the four licenses.

**Tanzania**

Tanzania takes pride in being the first nation in East Africa to regulate online gambling, enacting the Internet Gaming Regulations in 2012. Its latest legislation includes the Sports Betting Regulations passed in 2016, as well as laws enacted in 2018 concerning gambling equipment standards and the establishment of a central electronic monitoring system for route operations.

The Ministry of Gaming Oversight and Finance has collaborated to create a new digital tracking system for gambling regulation, known as GREM. This system is currently undergoing a trial period and is anticipated to be fully operational within the coming year.

The Gaming Oversight Board is demonstrably committed to these regulations, having dedicated significant resources to examining regulatory structures in leading jurisdictions such as the Isle of Man and Malta. A preliminary online casino bill has also been presented, but it requires official publication before it can proceed. It is heartening to note that the monitoring platform was developed domestically, which will contribute to the growth of the local software sector.

In Kenya, earlier this year, gambling company advertisements proliferated unchecked until the Betting Control and Licensing Board intervened. The board issued a directive prohibiting operators from advertising on social media platforms, forbidding celebrity endorsements, and banning advertisements between 6am and 10pm.

Furthermore, the board mandated that all advertisements must include cautionary information regarding the potential consequences of gambling, including its addictive nature. This warning information must occupy one-third of the advertisement’s space and utilize the same font as the remaining text.

This praiseworthy endeavor comes at a time when the gambling sector dominates the nation’s advertising expenditures, contributing to Kenya’s alarmingly high rate of underage gambling across Africa.

The governing body also declined to reauthorize licenses for several operators due to outstanding tax liabilities amounting to hundreds of millions of dollars. This tax predicament is not a recent development, but a longstanding issue. Out of twenty operators, only three were granted renewed licenses, citing “miscalculations in winnings tax.”

These substantial reforms will likely influence other East African nations; however, the effectiveness of this directive’s implementation remains uncertain.

Kenya has consistently been a favored destination for European operators, which may explain the motivation behind these new regulations, subtly targeting foreign entities profiting from local vulnerabilities. The 2019 Gambling Bill aimed to replace the 1966 Betting, Lotteries and Gaming Act, mandating that 30% of each licensee’s equity must be held by local individuals.

Similarly, the final form of the bill’s framework, following consultations with industry stakeholders, remains unclear.

Yahaya Maikori is a senior partner at Law Allianz, a prominent gambling and entertainment law firm in Africa.

Hes also a co-founder of a worldwide gaming organization that offers guidance to regulators, businesses, and new ventures in Africa’s expanding gaming sector.

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