Job cuts loom as 19 betting firms’ permits cancelled

Gamblers in a betting shop in Nairobi. FILE PHOTO | NMG 

By CONSTANT MUNDA
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Summary

• The renewal of licences for eight other betting firms as well as 13 casinos and six lotteries has been deferred to a later date, BCLB said in a statement yesterday, giving them a lifeline to continue operations.
• The board said the renewal of the licences is dependent on operations and directors of the firms getting a clean bill of health in an ongoing security vetting process.
• All gambling firms, whose annual licences are renewed at the end of June, are undergoing fresh vetting following a directive issued by Interior Secretary Fred Matiang’i on April 1.
• Dr Matiang’i had said the permits for all betting firms will be suspended from July 1 unless they complied with the law, including payment of all outstanding taxes.

The Betting Control and Licensing Board (BCLB) has refused to renew operating permits for 19 gambling firms in a shake-up of the Sh200 billion industry in a move that could result in job losses.

The renewal of licences for eight other betting firms as well as 13 casinos and six lotteries has been deferred to a later date, BCLB said in a statement yesterday, giving them a lifeline to continue operations.

The board said the renewal of the licences is dependent on operations and directors of the firms getting a clean bill of health in an ongoing security vetting process.

All gambling firms, whose annual licences are renewed at the end of June, are undergoing fresh vetting following a directive issued by Interior Secretary Fred Matiang’i on April 1.

Dr Matiang’i had said the permits for all betting firms will be suspended from July 1 unless they complied with the law, including payment of all outstanding taxes.

BCLB, the gambling industry regulator, said it has put in place measures aimed at regulating availability, accessibility and affordability of gaming platforms used by companies in betting, casinos and lotteries.

The authority said it was further tightening operational requirements for betting companies.

“The board, in collaboration with government agencies, will be conducting sustained vetting of all licensees in the gaming industry and shall not hesitate to debar non-compliant operators in any category,” BCLB said in the statement.

“All licensees will undergo a quarterly review to determine their level of compliance, and the cumulative review shall be used in deciding if they qualify for renewal or not upon the expiry of the licence.”

The board did not disclose the identity of companies whose licences it has declined to renew nor the ones whose verdict it has deferred.

The Betting, Lotteries and Gaming Act requires the board to investigate and consider any information or declarations submitted for application or renewal of licences before giving the green light for operations.

The investigation largely focuses on the fitness of the applicant to hold a permit, suitability of the gaming premises and approval from the county in which the business is located.

The board considers the applicants’ financial status, educational or other qualifications or experience of its directors, ability to carry on gambling activity as well as the reputation, character, financial integrity and reliability.

The board is required to give applicants an opportunity to be heard before determining whether they are fit and proper to operate a gambling business.

Persons who provide false declarations face a fine of up to Sh500,000 or a maximum jail term of six months or both upon conviction by a court of law.

Dr Matiang’i had accused betting firms of tax evasion, claiming they owe the Kenya Revenue Authority (KRA) Sh26 billion in unpaid dues – some of which have been challenged in court. The gaming industry in Kenya has grown rapidly over the last five years to Sh202.67 billion ($1.98 billion) from Sh2 billion, employing 5,000 people in the process, official data shows.

“The focus on this (gambling) sector is not to kill it. It’s to ensure that the government gets a fair share of the revenue that’s transacted on these platforms,” Maurice Oray, deputy commissioner for corporate policy at the Kenya Revenue Authority, said on June 25.

“It’s a sector that has largely not effectively contributed to the tax basket.”