ONLINE GAMBLING – BY NEIL DUNDAS

Thursday, October 07, 2004
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If you ignore something long enough, it might just go away, or so the saying goes. The fact remains though that despite the hopes of the majority of governments, Internet gambling has not gone away, but has flourished into a multi-million dollar business creating thousands of jobs.
 
In 1996 the South African the Government passed the National Gambling Act 33 of 1996. This act is silent on the issue of Internet gambling but does state in Section 13 that gambling in South Africa should be governed by a set of principles, one of which is:
 
“Gambling activities shall be effectively regulated, controlled, policed and licensed”
 
The nuts and bolts of gambling legislation devolved to the provinces since gambling constitutes a functional area of concurrent national and provincial legislative competence in terms of Schedule 4 of the Constitution.
 
Interestingly in 1999, the National Gambling Board published a paper on “Interactive Gambling”. The report mentions the following (National Gambling Board, 1999, 12):
 
“However the competitive advantage which this happy concatenation of circumstances bestows on South Africa cannot be expected to last for more than a few months. This means that South Africa must act quickly in creating the best possible jurisdictional environment for attracting both the suppliers and the customers of Internet gaming.”
 
Despite the urging of the National Gambling Board the issue of legalizing online gambling remained unresolved in South African law, notwithstanding the tremendous growth and popularity of online gambling. Until now, that is.
 
On 31 July 2003 Government published the National Gambling Bill 48 of 2003. For the first time Government has attempted to broach the thorny issue of online gambling in legislation. The Bill defines an “interactive game” as:
 
 
 
 
 
“a gambling games played or available to be played through the mechanism of an electronic agent accessed over the Internet.”
 
The Bill then goes on to state in Section 11 that persons “must not engage in or make available an interactive game except as authorised in terms of this Act or any other national law”. The effect of Section 11 is that interactive gaming is legal provided it is licensed.
 
However, the government’s vacillation on the issue of Internet gambling is evidenced by Section 6 of the Schedule to the Bill. This Section provides for the creation of a committee within the National Gambling Board (NGB) who should be responsible for formulating policy and legislation for interactive gambling.
 
Bearing this in mind, what would be the most prudent way for government to proceed? We suggest that government should suspend the operation of Section 11 until such time as the NGB’s committee on Internet gambling has devised the necessary policy and recommendations to deal with the issue in a considered manner. We believe that it is foolhardy to attempt to licence an activity which is clearly the target of further investigation and consideration, especially when the livelihood of thousands of people may be affected by this.