Silversands could be under pressure as SA's regulation of online gambling comes into effect
The most prolific online poker advertiser on South African national television, Silversands Poker, could be about to face difficulties with the South African authorities as that country's long-anticipated Internet gambling regulations come into effect, reports Business Day.
Published in the Government Gazette for public comment in February this year, the legislation making online gambling a licensed activity is nearing inception....and one of its stipulations is that any operator that works illegally will not be allowed to apply for a licence or advertise its services within the boundaries of South Africa.
Silversands has until now taken advantage of a regulatory void and continues to operate illegally, raising the ire of both the National Gambling Board (NGB) and the [land] industry, the newspaper reports.
Thebi Moja, acting CEO of the NGB, told Business Day that the board and various law enforcement bodies are trying to put a stop to Silversands' operations. “They know very well that they are operating illegally and we have for a number of years attempted to put a stop to their activities,” he said. “If we are able to prevent them from operating in South Africa that would be a big victory.”
The board is taking a hard line against illegal online gaming. Moja cities the example of a South African who won SA Rands 8 millions ($800 000) on an offshore online gaming site but was prevented by the South African authorities from bringing the funds into the country.
The local land gambling industry is also frustrated at being unable to compete with the likes of Silversands. Last year the Casino Association of SA (Casa) unsuccessfully lodged a complaint with the Advertising Standards Authority (ASA) in the country regarding the Silversands television and print adverts.
“We have let it ride for now. There was no point in pursuing Silversands as there is no regulation yet to hold them to,” says Casa CEO Derek Auret, explaining that Silversands repositioned their adverts as an educational campaign, claiming to teach people how to play poker rather than as an online gaming site per se.
National Gambling Board spokesmen are hopeful that the new licensing regime will be in place within the next few months, provided that the public consultative phase does not result in significant changes to the proposed regulations, which have already been subjected to extensive debate.
Under the proposed regulations South Africans wanting to play online will have to open a nominated South African bank account that will be used solely for online gaming. Only credit cards can be used to make payments, and the accounts will have to adhere to normal banking and FICA requirements.
“We will work together with the banks and the SA Reserve Bank to monitor the accounts and players will not be permitted to have more than R20 000 in their accounts at any point,” says Moja.
Once the regulations are in place, the NGB envisages issuing 10 online licences to South African operators, Business Day reports. Licensees will be required to have their servers based in SA.
The South African horse racing and betting group Phumelela CEO Rian du Plessis has confirmed that his group will seek a licence once the regulations are in place.
Anthony Puttergill, CEO of the land casino group Peermont, says they too will apply when the licences become available. Puttergill believes there is huge growth potential in the online environment, particularly as internet penetration in SA increases. He estimates the market at between R400 million and R1 billion at present.
The proposed Interactive Gambling Tax Bill provides for a tax on online operators of 6 percent of gross gambling revenue.
Meanwhile, Professor Don Ross, research director at the National Responsible Gambling Programme in South Africa, has been considering the likely impact of regulated online gambling in the country.
“On a theoretical level, online gaming's increased accessibility should make it more dangerous than traditional gaming," Ross said in a recent interview. "But from the limited investigation we have done, that does not seem to be the reality."
However, Ross believes that easy access to credit may be a bigger problem than addiction itself. “It can be said that people may not fully appreciate the financial implications of using credit and it could get even responsible gamblers into trouble,” he suggested, adding that limiting online accounts to R20 000, as proposed in the new online gaming regulations, was a prudent regulatory feature
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