The launch of an online sportsbook in South Africa is quietly breaking new ground for the gambling industry there. While online casino-type gambling is still only a "gleam" in its proponents' eyes, wagering site SportsBet.co.za has managed to legally launch under a license issued by the Western Cape Gambling and Racing Board. It's the first such bookmaking site permitted to operate online in South Africa.
"There is no direct legislation pertaining to Internet sports betting," explained LiveBet's Andrew Beveridge. (LiveBet developed the betting platform for the SportsBet site.) "It is up to the different provincial gambling boards whether or not they permit this activity. The National Gambling Board
currently does not expressly regulate this activity. The Western Cape Gambling and Racing Board is allowing Internet sports betting."
To get the site licensed required several steps. First, the sports betting operation needed to obtain a bookmaker license from the gambling board. In addition, only software that is approved by both the
gambling board and the South African Bureau of Standards can be used for the online betting site.
"A problem that a bookmaker based in South Africa will experience is that the South African Reserve Bank does not necessarily permit the acceptance of bets from offshore customers and the offshore settlement of winnings," Beveridge said. "Atlantic SportsBet has obtained permission for this."
The Reserve Bank, however, remains ambivalent regarding Net betting activity. Recent news stories have highlighted the bank's concern that online gambling sites could be used for money laundering purposes. Further, the bank is saying that people who gamble online using their credit cards could be violating foreign exchange regulations, according to the New Zealand Herald.
A spokesman for the reserve bank said that credit card companies had to hand over any credit card transaction records. Those using their credit cards to gamble online could face prosecution or loss of their credit cards, the spokesman added.
"We have appointed consultants to advise us how to handle the issue. Of course there is great concern about the flight of money out of the country via these sites, but that is a foreign exchange issue and falls under the control of the Reserve Bank," Thibedi Majake, a manager with the South African National Gambling Board, told the New Zealand Herald.
Nonetheless, the South African National Gambling Board remains committed to expanding gambling in the African nation online. South Africa already has two land-based casinos that operate online casinos in Swaziland. And now the government is currently looking at the regulatory and legislative framework needed for wider licensing of online casinos.
"Once we have received a report from the consultants on proposed measures to handle and control these sites, we will advise the government on legislation on this particular industry," Majake added.
The Western Cape Gambling and Racing Board is confident that the necessary regulations can be developed to monitor and control South African e-casinos. Safeguards could also be implanted to guarantee that all taxes be paid. (Currently a 6 percent tax is charged to each player's winnings.)
"This will mean money will flow into this country, rather than flow out. Also companies and sites based here will at the least pay company tax, which will boost the local economy. At the moment, aside from the fact that it is illegal for South Africans to gamble on these sites, it can also be highly risky," spokesman Russouw Lubbe from the Western Cape board told the New Zealand Herald. "Who knows how secure the credit card information is on such sites? I believe there is a window period for South Africa to get involved in this industry so that it can be effectively controlled and monitored."