Gamblers and betting companies are set to feel the weight of new regulations that have proposed restrictions on the use of mobile phones for gaming.
The draft rules contained in the Gaming Bill 2019 are targeted at the online gaming industry that targets mostly the youth, a big majority of who place their bets using mobile phones.
“The Bill seeks to…restrict use of telecommunication platforms as media for gambling in Kenya,” said the chair of the National Assembly’s Sports, Culture and Tourism committee, Victor Munyaka, at a media briefing yesterday.
The Bill, which is sponsored by the parliamentary committee, is due for its first reading at the National Assembly next week.
It seeks to repeal the Betting, Lotteries and Gaming Act of 1966.
It comes amid revelations that Kenyan youth have fallen into the blacklists of lenders after failing to repay loans borrowed to finance their gambling habits.
An earlier attempt to repeal the Act through the Statute Law (Miscellaneous Amendments) Bill flopped on the floor of the House.
The old law has been outdated as the technology and processes around gambling have evolved, leaving the youth exposed to the negative impact of betting.
According to surveying platform Geopoll, Kenya has the highest proportion of youth engaged in betting in Africa at 76 percent.
They spend an average of Sh5,000 per month, mostly on football bets.
The betting firms are estimated to owe the Kenya Revenue Authority Sh26 billion in unpaid taxes.
Part of the proposals in the Bill are targeted at addressing the menace associated with addictive gambling and regulate uncontrolled gaming advertisements.
This is expected deal a blow on SportPesa, Betin, Betika, Betway and 1xBet, which run adverts to entice more customers.
SportPesa had not responded to our queries by the time of going to press.
“We do not know the extent of the proposed restrictions yet but since we are an online business this will definitely affect us,” said Betway chief executive Leon Kiptum.
Data from PricewaterhouseCoopers (PwC) showed Kenyans are paying billions of shillings to access the internet, with most of the data bundles consumed on gambling, streaming music and videos, playing video games and networking with friends.
Kenyans spent 269 million gigabytes (GBs) of data Last year and consumption is projected to rise to 984 million GBs in 2022.
The PwC findings put internet advertising revenue at $38 million (Sh3.8 billion) per year, indicating advertisers’ increasing battle for online eyeballs.
The Gaming Bill has sought to introduce taxation on gambling advertisements on revelations that most of the revenue currently benefits foreigners.
It further proposes that citizens co-own betting companies through shareholding, in an effort to ensure Kenyans have a stake in the gaming industry.
“Before the new companies start getting the new licences they have to incorporate willing Kenyans to the extent of 30 percent,” said Mr Munyaka.
It has proposed tax rebates for companies that will sponsor local teams and promote sports in Kenya.
“The old Act has only about 70 clauses while the new Bill has 170, which means that the gaps have actually been addressed,” he said.
The proposals come days after Interior Secretary Fred Matiang’i signed deportation orders for 17 foreigners who declared they would undertake specific businesses when entering the country, but ended up investing in betting.
Most of those to be kicked out were in betting and casino businesses and include Chinese, Spaniards, Turks, Serbians, South Koreans, Bulgarians, Italians and Danes.