Black Market Online Casinos in South Africa

March 31, 2010 | News Category: Gaming Law

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Many countries undergo long battles before online gambling legislation is passed. There are always those that support online gambling, and those that do not. Usually, because of the opposition to legalizing online gambling, the process takes quite some time, and those who oppose the legislation work hard to prevent the legislation from taking place.

In South Africa, however, the opposite is true. In 2008, the South African government passed laws that would regulate the online casino industry in their country. However, these rules have simply not been implemented yet. Now, in 2010, there are those overseas online gambling operators who have chosen to enter the market without regulation, since the regulations have not yet been implemented, and are exploiting the South African Internet gambling market illegally.

The process of implementing the act that was passed in 2008, the Interactive Gambling Act, has been so slow that even those operators that would prefer to run legal online casinos have not waited for the act to be implemented. The online casino black market is thriving in South Africa at this time.

Tyrone Dobbin, a South African sports betting operator has explained, "I watch these foreign illegals establishing a foothold in the country without the benefit of tax."

The Interactive Gambling Act in South Africa provides for the licensing of up to ten online casino operators to run their online gambling operations in the country. These online casinos would be regulated and taxed. The country, however, awaits the approval of Rob Davies, the Minister of Trade and Industry, to give his go ahead for the regulations that stem from the Act.

At this time, after the regulatory act has been passed, there are those who refuse to accept the passage of the law, and are arguing about the social costs, which have, of course, not been proven at this time. There are also those that assume that gambling is always linked to crime.

An advisor to the committee that drafted online gambling reports before the Interactive Gambling Act was passed in 2008, Wayne Lurie, noted that the fact that the government has not moved forward with the legislation is simply embarrassing to them.

He also said: "The industry cries out for regulation. Unlike land-based environments, every transaction can be monitored and the exact tax can be monitored. It's the easiest environment to regulate."

South African would-be online casino operators, and those from outside the country that would like to run legalized online casinos in South Africa, have no clear idea of when the legislation will be implemented.