South Africa to Regulate Online Gambling Industry

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South Africa has joined the increasing ranks of countries willing to legalize and regulate online gambling, rather than attempt to restrict or prohibit it. has reported that local South African media have announced that a draft bill has just been approved by the South African Cabinet. This bill will legalize online gambling in the country for the first time in history if the bill is eventually passed into law.

Provincial governments have been concerned that they are losing out on a substantial tax revenue source as the government has taken some time to draft regulations to legalize internet gambling.

Online gambling is already widely available throughout the country from numerous online casinos, online Casino Tropez poker rooms, and sportsbetting bookmakers.

The draft bill approved by the South African Cabinet proposes a licensing system for both players and for online gambling companies, which will ensure gambling proceeds will be taxable. The manner in which those proceeds will be taxable has not been determined as yet, Astrid Ludin (South African trade and industry deputy director-general) told the Business Day newspaper.

Ms. Ludin pointed out the key challenge faced in drafting the proposed legislation was to find a way to effectively regulate all internet gambling and also how to put in place mechanisms to prevent money-laundering.

Online gambling was prohibited by the National Gambling Act of 2004 to give the South African government time to conduct further research into the new pass-time which has swept the world in the last five years. The Act gave the Trade and Industry Minister two years to draw up regulations to ensure online gambling would be effectively regulated. Those regulations have finally arrived in this draft bill approved by Cabinet.

The Trade and Industry Minister’s department conducted research into how other countries regulated online gambling, and they looked at Britain, the US and Australia was formulating their proposals. They have gone against the US path, and instead decided regulation was the more responsible option.

The draft bill is good news for the South African online gambling industry, which was rocked recently by a decision not allow a Swaziland online casino operator to allow online gambling. This decision could soon prove irrelevant if the draft bill eventually becomes law, as is expected.