INSIGHT AFRICA
REGULATORY COMPLIANCE
We are also using these platforms to inform the industry of new technologies and how they can have an effect on technical standards where the technical standards or regulations may not be adequate to regulate it properly.
Pierre Otto General Manager GLI Africa
How did Africa's regulatory landscape evolve and change in 2023?
With the increased gambling activity, technological advancements, and expected growth, more regulators in Africa are now more actively looking at implementing or improving gambling regulations, especially with regards to products that are entirely new to these markets.
Tis growth is primarily driven by mobile gaming, a sector that's gaining remarkable traction across the continent and needs adequate regulations. Tis needs to be in line with technical standards so that the landscape is clear regarding requirements for any gambling- related products entering these jurisdictions.
Tere’s a growing concern over the increase in online gambling and its easy accessibility, which could potentially lead to a rise in problem gambling. 95 per cent of African gamers play on mobile devices like smartphones and tablets according to a recent survey by a research organisation, Newzoo.
What's the political will of Africa's jurisdictions towards gambling heading into 2024? Is increasing international pressure on the gambling sector to join the fight against international financial crime having an impact?
We have seen that there is political will to regulate and to put regulations and technical standards in place. It just takes time to get this implemented via the legal framework for some of the regulators. Te increasing international pressure is helping to prioritise the implementation of regulations and standards to fight and prevent money laundering and other crimes.
What's the significance of several African nations being on the Financial Action Task Force's (FATF) grey list for the operators and
platform providers servicing those markets?
Te most significant implication to a country that is grey-listed is the reputational damage to the country, as its effectiveness in combatting financial crimes like corruption and money laundering, as well as terror financing are deemed to be below international standards.
With several African nations being on this list, it can impact the provider’s financial reputation, making it challenging for servicing those markets. It may lead to increased scrutiny, difficulty in accessing international financial systems, and potential economic consequences for the countries involved.
As a result of this, it will pose a risk to many multinational platforms and content providers as it will be much more difficult to do business in these countries due to additional checks and balances. Tis will, in return, affect the operators that make use of manufacturers serving these markets.
Te FATF is taking a close interest in the sector and is currently consulting on its updated guidance on a risk-based approach to AML/CFT for virtual assets and virtual asset service providers (VASPs).
Te FATF has long been concerned that the online gaming and gambling sector is a magnet for financial crime and, in June 2019, announced that VASPs would be subject to its AML/CFT guidance.
How is GLI working with African regulators to ensure that effective measures are in place to protect players and they keep abreast of the ever-changing technology playing field?
GLI is constantly engaging with regulators throughout Africa and are attending key conferences where all stakeholders are present.
It seems inevitable that regulators across Africa will follow the lead of regulators outside of Africa to implement or tighten legislation and enforcement for online gaming and gambling. This is driven by
international pressure on the online gambling sector to join the fight against international financial crime. We can already see
developments, with Kenya, Uganda, and Tanzania leading the way.
Regulators will only be able to provide assurance to the public if all products are tested and properly regulated in their jurisdictions. Tis is also important for providers as they will be more comfortable to supply products and compete in a stable well-regulated environment which provides a stable platform for growth. Regulators should also be mindful not to over- regulate a market.
We are however seeing in Africa a more focused effort by regulators to get to grips with the huge growth in online gaming, along with a significant effort to better understand new technologies, payment methods, and how to effectively regulate them.
As technology progresses at a fast pace, regulators are struggling to keep up. African regulators are therefore hard-pressed to ensure that effective measures are in place to protect the public, and understand the ever-changing playing field with technology, while at the same time also ensuring that taxes are getting paid where it is due.
Tanzania, Kenya and Uganda have led the way in passing specific regulations aimed at online gambling. What's the impact of these developments been for each of these markets, respectively?
It seems inevitable that regulators across Africa will follow the lead of regulators outside of Africa to implement or tighten legislation and enforcement for online gaming and gambling. Tis is driven by international pressure on the online gambling sector to join the fight against international financial crime.
We can already see developments, with Kenya, Uganda, and Tanzania leading the way in passing specific regulations aimed at online gambling.
Kenya
Tere has always been a large focus on Kenya from operators. However, some big operators have recently exited the market, which may be a result of the recent changes to the country’s gaming taxes.
Tere were initial plans from the government for its 2023 finance bill to amend the excise duty in gaming from 7.5 per cent to 20 per cent. Tey have, however, now settled on 12.5 per cent. Most of the regulatory changes are around taxes. Tere are also requirements that betting companies be integrated into the KRA tax system. To them, this is a more streamlined approach to tax collection with 24 hours of the closure of transactions.
WIRE / PULSE / INSIGHT / REPORTS P43
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