Kenya, alongside Nigeria and South Africa, is one of the largest online gaming/betting markets in Africa. In Kenya, the popularity of online gaming is fueled by a high affinity towards sports and technology, particularly by the youth. This is combined with the ease of access and the convenience of using mobile phones as tools for online gaming. In Kenya, the increase in online gaming activities has presented new legal and administrative challenges in the sector. There has, as a result, been increasing concerns on the adequacy of the current legal regulatory framework to control the sector particularly in light of the potential negative effects of online gaming such as addiction among the youth.
Administratively, gambling and gaming activities are controlled by the Betting Control and Licensing Board (“BCLB”) established under the Betting, Lotteries and Gaming Act, Chapter 131, Laws of Kenya (the “BLGA”). The BCLB, in turn, administratively falls under the Ministry of Interior and Coordination of National Government (the “Ministry”).
In recent weeks, there have been increasing administrative directions from the Ministry and the BCLB. On 1st April 2019, the Minister in charge of the Ministry publicly announced various proposed measures and changes in the regulatory framework of the gambling and gaming sector. The measures were the proposal for the introduction of a gambling and gaming policy, introduction of a bill in Parliament for consideration to repeal the BLGA, directions to the BCLB to review the advertisements for online gaming activities made in Kenya and the directive to the BCLB to document all the agencies involved in gaming and gambling activities and ensure that they have complied with Kenyan immigration and taxation laws. It will be interesting to see how these measures will change the sector in the coming weeks and months.
Perhaps following the Minister’s directions, the BCLB issued a publication dated 30th April 2019 on the advertisement of betting, lottery, gaming and prize competitions (the “Notice”). In the Notice, the BCLB acknowledged the potential negative effects of gambling and gaming and banned the following:
outdoor advertising of gambling;
advertising of gambling on all social media platforms;
advertising gambling between the hours of 0600 hours and 2200 hours; and
endorsements of gambling operations by ‘celebrities’
The BLGA does not currently specify which media can be utilised for the advertisement of gambling and gaming products and how such advertisements are to be done. While the BCLB as the regulator has wide powers under the BLGA, it is arguable whether the BLGA gives the BCLB such blanket powers to issue the directives issued in the Notice. The BLGA only appears to expressly give the BCLB powers to issue licenses and permits, cancel or suspend them and to inquire into complaints against licensees and permit holders.
We anticipate that there will be heightened debate by industry players on the legality and the extent to which the Notice will be applied and enforced. It is arguable whether the Notice applies 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. This directly relates to the legal position of providing online gaming from remote locations to Kenya-based punters.
We are not aware of any review court proceedings that have been lodged in court in relation to the administrative directives issued by the BCLB in the Notice. In the intervening period, pending any alternative decision of a court, it will be imperative for industry players to make plans to comply with the directives of the BCLB in the Notice on or before the deadline, 30th May 2019. In light of the administrative directions in the gambling and gaming sector in recent days, we anticipate that there will be further significant legal regulatory and administrative changes in relation to gambling and gaming activities in Kenya and industry players and stakeholders will need to track these to ensure compliance with any changes that may be effected or, where necessary, proposed.