South Africa’s Online Gambling Debate: Legal Ambiguity, Offshore Surge, and the Battle for Regulation

In October 2025, a surge of headlines ignited widespread confusion, criticism, and intense debate across the gambling industry, with many claiming that South Africa had effectively imposed a nationwide ban on online casino gambling. In reality, the situation was far more complex and nuanced than those initial reports suggested.

The controversy originated with Supabet (Portapa Pty Ltd), which introduced a roulette-style product within physical betting shops. This offering allowed customers to place fixed-odds wagers on outcomes resembling traditional casino games. The Casino Association of South Africa challenged the move, arguing that such products fall under casino gaming and should therefore be restricted to operators holding casino licences, rather than those licensed for betting.

The matter escalated to South Africa’s Supreme Court of Appeal, which sided with the Casino Association. The court clarified that under the Gauteng Gambling Act, betting and casino gaming are legally distinct and require separate licences. The judgment effectively closed a regulatory loophole that had allowed operators to stream casino-style games and market them as betting products. It reinforced the principle that bookmakers may offer fixed-odds betting on legitimate events, such as sports, but are not permitted to provide casino-style gaming through betting platforms.

However, confusion quickly followed. Some organisations, including the National Gambling Board of South Africa (NGB), interpreted the ruling more broadly, suggesting it applied to all forms of online casino-style gambling. In reality, the court’s decision was limited to retail activity within Gauteng, not a nationwide or online prohibition.

This misinterpretation fueled a broader debate around the legality of online “contingency betting.” At its core, contingency betting involves placing fixed-odds wagers on uncertain outcomes—ranging from political events to sporting results. The legal grey area lies in whether casino-style games like roulette can also be classified as such uncertain events. While some operators argue that they can, others insist this constitutes illegal online casino gaming, leaving the issue unresolved.

“The National Gambling Board in South Africa is at loggerheads with the nine provinces about the interpretation,” explains Sean Coleman, CEO of the South African Bookmakers’ Association. “The National Gambling Board are saying this purported contingency betting is in fact interactive gaming and it’s unlawful. And the provinces disagree. Nobody’s gone to court yet to get any sort of declaratory order on the issue.”

Wayne Lurie, Director of Lurie Inc Attorneys, believes the confusion was not accidental. “I was going to use the word bamboozled into an understanding which I think is the National Gambling Board’s intention – to confuse the markets around what is actually legal in South Africa,” he says.

He continues: “This is a campaign of disinformation, I believe, that’s trying to achieve an end goal of a national ban that is actually not within the[ir] statutory power as a national regulator, because as a national regulator, they misunderstand their position which is not to regulate the gaming activity around the country in each and every province.”

According to Lurie, the NGB’s role should be limited to establishing norms and standards while acting as an oversight body. Acting CEO of the NGB, Lungile Dukwana, strongly rejects this characterization, maintaining that there has never been ambiguity regarding online casino-style betting. He argues that misunderstandings stem from operators misreading the law, particularly as online betting expanded rapidly during the COVID-19 pandemic.

“Obviously some of the contributors to this misinterpretation may have been an issue because sports betting became more prominent during or after COVID because people could not go to the casinos and all of those kinds of things. [Online gambling] started to pick up in South Africa; it increased quite significantly if you compare it to the period before that,” Dukwana explains.

He reiterates that under the National Gambling Act of 2004, specifically Section 11, only sports betting is permitted online, while interactive or casino-style gambling has always been unlawful. Dukwana emphasizes that the law exists to protect both consumers and compliant operators, noting that the NGB has begun engaging with foreign jurisdictions where many illicit operators are based and has issued formal notices to address the issue.

“It’s work that is ongoing and I think that people are going to [have to] watch this space, as NGB, we are not sleeping on the job, we are doing the job that we are supposed to be doing to protect the punter, to protect those ones who are licensed and to deal with the ones who are not complying to the law,” he says defiantly. “That is our responsibility.”

The Gauteng ruling has also reignited concerns about offshore gambling. A key issue is whether limiting legal offerings is inadvertently pushing players toward unregulated international platforms. While opinions differ on regulation, there is broad agreement across the industry that offshore activity has reached significant levels.

A 2024 Yield Sec report found that 62% of South Africa’s gambling market is illegal, generating approximately R55 billion in revenue, much of which flows offshore. With legal operators paying around 6.5% in taxes, this translates into an estimated R3.5 billion in lost government revenue.

Coleman, who commissioned the report, highlights the economic implications: “When you have a look at our economy and the infrastructure and what’s going on with people having no water, electricity and various other things, you can only imagine what R3.5 billion in additional taxes into those provincial economies would be doing for those provincial budgets.”

The report further revealed that 2,084 illegal operators actively target South Africa, with 16.3 million individuals engaging with illegal gambling over a 12-month period. Lurie describes the situation as both “significant” and “devastating,” pointing to weak enforcement mechanisms.

“There’s no effective enforcement, gate or bar on South Africans… it is quite easy with all sorts of means such as crypto and otherwise to mask transactions going in and out of the country,” he explains.

“So, offshore casinos are sort of free to offer their services, offer their games to local punters with very little government intervention. And this is one of my main concerns and criticisms of the National Gambling Board again in terms of picking fights at every opportunity and public scraps with the provincial regulators, as well as the licensed operators who are contributing significantly to South Africa.”

He adds: “[They’re] ignoring the threat that’s coming from outside our borders in terms of offshore operators.”

Dukwana acknowledges the scale of the problem, noting that enforcement is particularly challenging when operators are based abroad. “They are doing things that should not be done in South Africa, but we don’t have people to go back to in terms of enforcement. We have to work harder in order to trace them and also refer them to the jurisdictions where they are actually coming from,” he says.

He further notes the competitive advantage enjoyed by offshore operators: “It leaves us to deal with the consequences.”

The regulatory debate also intersects with growing concerns about problem gambling. Some advocacy groups and civil society organisations have called for stricter controls or even a total ban on online betting, describing it as a “silent epidemic.” Others argue that tighter restrictions may worsen the situation by pushing more activity into the illegal market.

Lurie believes that banning online gambling would have severe consequences. “A total ban of online gambling in South Africa will be utterly disastrous; [it would] just entrench the offshore illegals position more than ever before,” he says.

“There’s always a market for illegal [gambling] and all you’re doing is increasing, not only the access to it, but the desire for it. So I think that the [government] is exploiting the responsible gambling narrative to try to say, ‘Well, we need to throw the baby out of the bath water’, whilst neglecting their duty to deal with responsible gambling initiatives like the self-exclusion database.”

He adds that while some operators are making progress in addressing problem gambling, they lack sufficient government support. Coleman echoes this sentiment, advocating for stronger collaboration, including access to official databases for age verification to prevent underage gambling.

Dukwana maintains that gambling should remain a regulated recreational activity that generates revenue while protecting vulnerable groups. He emphasizes the need for collective responsibility: “We are saying that we should be one on [responsible gambling] and try and implement the legislation as it’s actually [meant to] protect the vulnerable groups. It’s a responsibility of all of us to do that and if we do that, the market itself will be in a safer space, it will be sustainable and will be able to advance as we are supposed to without causing harm to society. But [we should be] also reaping the benefits that we’re supposed to reap in terms of the economics of it.”

Despite ongoing challenges, the gambling industry remains economically significant, generating approximately R4.8 billion annually. However, debates continue over taxation and regulation. Proposals for a national 20% tax on gambling profits have faced strong opposition from operators, who argue it could drive players further toward illegal platforms.

Some industry stakeholders advocate for expanding legal offerings—such as regulated online casino games—to encourage “re-channelisation,” where players shift from offshore operators back to licensed domestic platforms. However, legislative efforts like the Remote Gaming Bill remain stalled, leaving a gap between consumer demand and regulatory frameworks.

Coleman questions the logic of current policy approaches: “We want to discourage gambling and we want to dampen this down, but then you tax the operator… it just doesn’t make economic sense.”

He adds: “What we advocate for is that we’d much rather work closely with the government and be able to try and create additional re-channelisation of the offshore illegal market back onshore where immediately the provinces get 6.5% and the national government gets another 12% which is the net amount.”

Dukwana acknowledges that stricter enforcement may cause short-term disruption but believes it is necessary for long-term sustainability. “We think that going forward it’s the pain that we’ll have to take for now, but it will be better as we go along. But we must all participate in that [plan] to make the environment better and sustainable,” he says. “For us, it’s about sustainability, the safety of the player, but also it’s about the growth and the economy that we actually want to see, but we have to take some pain in order to get there.”

Not everyone shares this optimism. Lurie warns that the current trajectory could lead to increased litigation and further market instability. “I’d love to be positive, but I think that if we carry on this trajectory, we are going to enter into an era of more litigation,” he says.

“I think it’s going to open the door even wider, not that it’s not already wide open, for the illegals to strengthen their hold on the market. I think if anything, the consequence would not be pushing the legitimate operators as much into the grey [market] as to just leave the market as they are doing in places like the UK; they’re leaving the market behind where the taxes are becoming unfeasible.”

Coleman agrees, warning that consumers will naturally gravitate toward better value offerings on illegal platforms. “When people have a look and size you up against what’s available on the illegal market, they’ll move to that illegal market because the pricing is more competitive and is better value for the money, and that’s a serious concern for us.”

Dukwana, however, remains confident that South Africa’s tradition of debate and engagement will lead to resolution. “The reality is that if you understand South African culture and how we operate in South Africa…there are normally different opinions, but we normally find a way of resolving some of these particular things,” he says.

He concludes with a forward-looking perspective: “So, I think this is leading us to a long-term reform. In fact, I wouldn’t even say long-term, medium-term reform because I don’t think it’s going to take that long. In the medium term we should be able to address this particular issue, but all of us for now must find ways of making sure that we work within the law.”

By fLEXI tEAM