Each time a player located in South Africa places a bet on a foreign based online gambling site an unlawful gambling activity occurs, with such illegal gambling activity being facilitated, inter alia, by the bank of the player in South Africa. As such, South African banks and credit card institutions serve as a conduit between the SA online gambler’s banking account and the foreign based gambling website operator’s banking account, without which the unlawful gambling transaction would not be able to occur. In terms of Sections 8(a) read with Section 11 of the National Gambling Act 7 of 2004 (the National Act) it is unlawful to engage in or make available a gambling activity, unless that activity is licensed in South Africa.
Offshore international gambling and betting licensing hubs are jurisdictions that have established regulatory frameworks to attract online gambling and betting operators by offering licences. These hubs often provide favourable conditions such as lower taxes (i.e. no tax paid in the jurisdiction where the point of sale takes place), streamlined regulations (i.e. under-regulated), and legal stability (i.e. no legal scrutiny). The number of these hubs is growing, and consequently so is the problem of illegal betting being camouflaged by pseudo-licenses. As the list below shows almost all of the offshore betting and gambling licensing hubs are small island territories with small populations (the exceptions being the Philippines).
| Jurisdiction | Licensing Authority Area | Size (sq miles) | Population | Location |
|---|---|---|---|---|
| Alderney | Alderney Gambling Control Commission | 3 | 2,100 | English Channel |
| Curacao | Curacao Gaming Authority | 171 | 148,000 | Caribbean Sea |
| Gibraltar | Gambling Commissioner | 2.6 | 2,000 | Southern tip of Spain |
| Isle of Man | Gambling Supervision Commission | 220 | 84,000 | British Isles |
| Malta | Malta Gaming Authority | 120 | 520,000 | Mediterranean Sea |
| Philippines | Philippine Amusement and Gaming Corp | 120,000 | 114 Million | Southeast Asia |
If you gamble on an overseas licensed website, you suffer the consequence of having your winnings confiscated by the National Gambling Board who work in conjunction with the banking sector, and you may be subject to prosecution for the offense.
Section 16 of the National Gambling Act deals with the forfeiture of unlawful winnings:
(2) A person must not knowingly pay any winnings from a gambling activity to‐
(a) a minor;
(b) an excluded person; or
(c) any other person who won those winnings in a gambling activity that is unlawful in terms of this Act.
(3) Any person who is prevented from paying winnings referred to in subsection (2) must remit those winnings to the board in the prescribed manner and form, to be held by the board in trust, pending a decision in terms of subsection (4).
(4) Upon receiving any winnings under subsection (3), the board must investigate the circumstances of the relevant gambling activity, and either‐
(a) deliver the winnings to the person who won them, if the board is satisfied that the gambling activity was lawful, and the winner was not a minor or excluded person at the time of the activity; or
(b) apply to the High Court for an order declaring the winnings forfeit to the State.
1. Every website landing page has a footer with a degree of regulated compliance information.
2. In South Africa, every licensed operator must provide details of their license (trading entity and entity registration number) together with who the provincial licensing authority (Gambling Board) is. Some sites even carry the logo of the respective Gambling board.
3. Illegal websites who do not hold a gambling license in South Africa will contain licensing information either on the landing page, the about us section or under their respective terms and conditions
