Kenya Market in Jeopardy; State-Run Lottery FavoredPublished December 8, 2019 by Lee R
With operators already getting pressed for taxation, the Kenya market regulation model may be crumbling.
A Kenyan report on possible constitutional changes in the nation has recommended private betting industry be shut down and replaced with a state-sponsored national lottery.
The Report's Conclusion
Released November 27th by the The Building Bridges Initiative (BBI) , the report asserts that the private betting industry in the country “is leading to hopelessness and greater poverty.”
Government Lottery Recommended
The report calls for a government-run lottery to generate funds for activities that “uplift the youth, sports, culture and other social activities beneficial to citizens.”
The report has been in the making for over a year and a half, ever since leading national political rivals President Uhuru Kenyatta and Raila Odinga united on March 9, 2018 to embark on a joint study to to improve the lives of Kenyan citizens.
The BBI held participation forums across Kenya’s 47 counties to decide study topics. Over 7,000 Kenyans responded, including over 400 current or former politicians and 123 individuals “representing major institutions.”
Private Operator Discontent
It turns out that long-time private betting operators such as Sportpesa and Betin have been at odds with Kenyan authorities over taxes for quite some time.
The tension came to a head last July 1st, when Kenya gambling regulator Betting Control and Licensing Board (BCLB) refused to renew the licence applications of SportPesa and 26 other companies over unpaid taxes, due to failure to meet the Kenya Gaming Bill application of a 20% tax on winnings to both profit and original bettor stake.
State and Sportpesa Clash
This culminated in a state ordered block on banking services to the 27 companies, serving to prevent customers from making deposits, to which SportPesa responded by suspending all of its sport sponsorships in the country and threatening legal action.
With President Kenyatta subsequently encouraging legislators to introduce a nationwide gambling ban last August, prospects suddenly look bleak in Kenya, a rather stunning swing from one of Africa's most developed markets.