South Africa - online gambling regulations

Gambling regulations and laws online in South Africa

South Africa, also known as the Rainbow Nation, has one of the richest histories of all. When it comes to gambling, more specifically online gambling, there is also a rich history. Many South Africans have been burning to become part of the online gambling scene. The online casino industry is growing at immense speed and with the improvement of technology, there are plenty of amazing games waiting to be played.

When it comes to the laws and regulations regarding online casino gambling, many South Africans are left confused and uncertain about whether or not they can partake in online gambling or if they will get into trouble. There is no shortage of interest from online operators as many online casino options pop up when a quick search is done on the web.

In this guide we take a look at the gambling laws of South Africa, the legality of online gambling and any repercussions players might face should they decide to take part in online gambling.

The history and laws of online gambling in South Africa

When taking a look at the laws regarding online gambling it is quite difficult to fully grasp what is going on. It seems that the South African government hasn’t been quite clear on its stance regarding online gambling. The country itself faces many problems when it comes to politics and the government, so to some degree, it is understandable that not much focus and effort has been put in place to either regulate or completely ban online gambling.

Overall gambling in South Africa is regulated by the National Gambling Act (NGA) established in 2004. With its establishment, the National Gambling Board (NGB) was also brought into existence, while all provincial laws were amended to align with the Act. In South Africa, gambling is somewhat ignored but embraced at the same time. By law, certain forms of gambling are permitted, including brick and mortar casinos, as well as, and gaming machines that can be set up in certain licensed venues.

Sports betting is another form of betting that is completely legal in the country. Interestingly enough, Lotteries are completely separate from the rest of the gambling forms and are themselves governed by the Lotteries Act established in 1997.

Back in 2004 the government, which saw potential in the online casino industry, was completely for legalising and regulating online gambling. In fact, the NGB was even instructed by the NGA to launch a committee to look into the matter. The framework that would help the country embrace new forms of gambling was created in 2008 when the government established the National Gambling Amendment Act. Here’s where things turn a bit grey for South Africans. While the president signed the Act into law in mid-2008, it was never publicised or given a commencement date.

When concerns were raised regarding the matter the Department of Trade and Industry explained that they were working on supporting regulations. It became evident later on that there were second thoughts and that the government had concerns about the socio-economic effect more accessible gambling would have. After this, the Act was put aside and created a waiting period for online casino operators waiting to make their mark on the South African gambling industry. All believed it would be resolved and implemented in due course.

During this “pause” period, the government created the Gambling Review Commission whose sole purpose was to look into the concerns. It was only in 2010 that the Commission released a report stating that legalising and regulating online gambling would be wise and could even help revive the industry. While this should have resolved the matter and moved things forward, instead it had the opposite effect.

Trade and Industry Minister, Rob Davies, took the report to the press and explained that the government would not be pressured into legalising forms of gambling that were at the time considered illegal in the country. Davies took the matter further by saying that illegal transactions would be monitored by the Reserve Bank and participating players should be aware that they might not receive their winnings.

The cat and mouse game regarding the laws of online gambling has been continuing ever since until the government finally issued a notice warning that more serious punishment will be given and that they will be taking a tougher stance regarding online gambling from 2017. This was stated early in 2016 along with a warning that no new gambling forms will be allowed into the country at this moment. In fact, it seems the governing parties are completely against the idea of opening their market to online casino operators and have gone the extra mile to prevent online casinos from advertising and getting to players.

Are online gambling winnings taxable in South Africa?

While the laws involving online gambling leave uncertainty and confusion the tax situation is clear. Players are not required to pay any taxes on winnings made from gambling as it is seen as a recreational activity. However, those who turn gambling into a profession and their main source of income will have to pay tax or face the consequences of being hunted down by the South African Revenue Service (SARS).

Is online gambling legal?

While it is illegal for online casinos to operate within South African borders or offer services to citizens, there is no law declaring it illegal for players to participate in the act of online gambling.

The government has issued a statement in recent years saying that they are fully aware that players can go online and gain access to these sites. Rob Davies himself stated that while the government can’t stop players from accessing or playing online casinos, they will be watching and they can and will take away their winnings. Players who get caught will be held responsible and receive criminal charges and punishment. All winnings taken from such players are placed into the Unlawful Winnings Trust.

It’s quite a scary concept and it can prevent many from playing at online casinos. For others, it’s worth the risk especially since the government has done very little over the past few years to enforce its ruling or tighten its grip on the industry. There are many online casinos operating from within South Africa as well as offshore operators who are aware of the laws but still willing to open their doors to South African players. If you are brave and willing to face the consequences should they arise, then there are plenty of trustworthy online casinos accepting South African players and even allowing them to play in Rand.