Stringent directive drawn as relicensing resumes in betting industry

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National lottery administration is said to restart giving licenses for betting companies, however, the administration has increased the license fee to 500,000 birr from the existing 400 birr while to renew the license companies are required to pay 100,000 birr which used to be 200 birr to restrain the adverse gambling effects on society. On Tuesday, September 13, 2021 authorities from the administration gave a press conference at Eliana Hotel regarding the remanded directive that governs the betting market.
For the last two years the administration had temporarily stopped issuing new licenses to betting companies, and as the director elaborates, any company which didn’t go as per the directive, the license faced revocation.
“As there has been disappointment over sports betting activities, citing its adverse impacts on the community, the new directive is needed to govern the sector with strict law and strength guide the betting market,” said Geremew Garje, director of the administration.
By strengthening the control on the market as the authority said issuing new license for new entrants in the market is opened with a permit fee which increased significantly from the 400 birr to 500,000 birr
After receiving complaints from different stakeholders and the society, the Administration established a task force and conducted a study in collaboration with the Ethiopian Management Institute, to assess the impacts of betting activities.
The new directive incorporates details on where betting companies should be opened and strengthens regulation on their daily activities. It will also require betting companies to regularly submit reports on their operations. Upon completion, the directive will be sent to the Ministry of Revenues for approval.
According to the new directive, licensed sports regulators will be required to provide 1.5 million birr bank guarantee.
According to Dessie Dejene, Director General of Licensing and Supervision at the National Lottery Administration, the Lottery Licensing Directive has been amended to include more restrictions that were not in the previous directive, as well as to ensure that the betting process is governed by strict rules and regulations.
According to the previous directive, the transfer companies have been operating without any bank guarantee. He said that a guideline has been prepared for them to guarantee.
It was also pointed out that the prize pool for sports betting lottery players has not been uniform and exorbitant fees have been paid in the past, but according to the new directive, the top prize for each ticket should not exceed one million birr.
Under the previous Sports Betting Lottery Directive No. 85/2005, anyone over the age of 18 was allowed to take part in the lottery, but due to public inquiries, only those aged 21 and over could participate in the game under the new rules, the administration said.
Dessie said there was no directive to inform the administration in advance of the sale, but that the companies should now notify the bank of their activities and submit their monthly banking report to the administration on a monthly basis.
The revised directive stipulates that sports betting sites should be located within 500 meters of religious institutions and school areas, and prohibits the establishment of betting establishments in restaurants, grocery stores and chat rooms.
The directive will compel betting companies to carry out charitable works, committing 0.5pc of their sales. According to the previous directive, all betting companies are obliged to disperse 20 percent or more from their net profits to sport institution or clubs; however none of those betting companies have been discharging their corporate social responsibilities.
The establishment proclamation of the Administration, enacted in 2007, gives it the mandate to regulate and license betting companies, while a directive was put in place five years ago with the same purpose. There are currently 42 active betting companies in Ethiopia.