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Developments Relating Gambling And Gaming Activities In Kenya – 22nd May, 2019


Compliance by foreign nationals

On 1st April, 2019 the Cabinet Secretary in charge of Interior and Coordination of National Government publicly announced several proposed measures and changes in the regulatory framework of the gambling and gaming sector in Kenya. One of the key directives required the Betting Control and Licensing Board (“BCLB”) in conjunction with the Department of Immigration Services to document all gaming and gambling operators and to evaluate the immigration status of any foreign nationals involved in the operation of these entities.


Perhaps following this directive, the Cabinet Secretary speaking publicly on 20th May, 2019, ordered for the immediate deportation of all foreign nationals engaging in gambling and gaming business in Kenya without the required permits. The Cabinet Secretary also directed that any foreign nationals who applied for work permits under different category but were involved in gambling and gaming business should also be deported.


The Cabinet Secretary appeared to express concern that the annual turnover in the gambling and gaming sector has risen exponentially in the last 5 years but that the sector continues to owe the Government huge amounts of money in unpaid taxes.


The latest pronouncement appears to be a follow-up to the earlier pronouncement that all gambling and gaming licenses will stand suspended with effect from 1st July, 2019 except licenses for those players who will satisfy that they will have fully complied with their tax obligations and the law.


Following the recent pronouncement, publicly available reports indicate that the Government had as of 21st May, 2019 deported several foreign nationals who were found to be engaging in illegal gambling and gaming businesses in Kenya.


Developments relating to advertisement of gambling and gaming

In our last alert, we referred to a BCLB directive dated 30th April, 2019 banning outdoor advertising of gambling, advertising of gambling on all social media platforms, advertising of gambling between the hours of 0600 and 2200 and endorsements of gambling operations by ‘celebrities’. We had anticipated that there would be heightened debate by industry players on the legality and the extent to which these directives would be applied and enforced and also whether the directives apply or can be enforced in relation to advertisements on pay television channels that ordinarily broadcast from outside Kenya and to internet-based advertisements on websites that are not hosted in Kenya.


We are now aware that following these directives, a Constitutional Petition No. 169 of 2019 – Murigi Kamau Wanjohi versus Cyrus Maina, Liti Wambua, Betting Control and Licensing Board and The Honourable Attorney General (“Suit”) was filed at the High Court of Kenya challenging the advertisement directives.


While this Suit still remains in court and it may not be possible at this stage to predict how the court is likely to determine the matter, there are currently in force interim orders issued by the court on 20th May, 2019 staying the implementation of the BCLB advertisement directives pending the determination of an application filed in the Suit.


Conclusion

It will be interesting to see how the many administrative measures being taken by the regulatory entities will affect the sector in the coming weeks and months. We anticipate that there will be increased administrative developments in the sector and, with these, increased debate by industry players on the legality, effect and consequences of the various developments.


Overall, we are of the view that it is imperative that industry players and stakeholders track these developments to ensure compliance with any changes that may be effected or, where necessary, proposed. In this regard, it may be important for entities in the sector to conduct comprehensive audits of their operations to ensure full compliance with the law and avoid inconveniences in their operations.


Lastly, we anticipate increased court proceedings relating to the increasing developments in the gambling and gaming sector. In particular regard to the Suit, we will track the developments and note to regularly issue updates on the same.

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