Tanzania: Managed gaming sector could contribute positively to society

Amne Suedi Kagasheki
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Tanzania already has one of the most sophisticated regulatory regimes, writes Amne Suedi Kagasheki, founder of Shikana Law Group. But still more can be done to antiquate the skeptics, and mould the growth of recent years into a sustainable and significant sector.

In the last years in Tanzania, gaming never really had much coverage as a serious investment. The industry was still shrouded in the misconception of being filled with illegal money, an elaborate scheme for money laundering and generally a means of luring unknowing punters and taking their money.

This perception is changing since Sportpesa entered the market almost a year ago and successfully launched its sports betting product in Tanzania. Sportpesa has invested significantly in the two major football teams in Tanzania -Yanga and Simba. It is currently employing many young Tanzanians and training them in understanding the gaming industry. Sportpesa has positioned itself as a serious investor in this sector thus causing people to look at gaming differently. Namely, as a sector which, if managed correctly, can contribute to the economy positively.

For those who do not know about gaming in Tanzania, it is regulated by the Gaming Board of Tanzania which is under the Ministry of Finance. Unlike other markets, Tanzania is very diligent in allowing gaming companies to operate. It carries out an in depth due diligence on the companies and their individual shareholders and directors who are applying for various licenses, to operate slot machines, retail casinos and internet casinos, sports betting retail and online. The due diligence requires complete transparency on one’s financial and solvent status, whether or not they are a good person in society (ie. not convicted of any crime) and the vetting also extends to family members such an applicant’s spouse.

Another important point of vetting is the financial capacity of the company and what I like to call the “rules of origin” of the money used to fund the company. The Gaming Board officials go as far as Gibraltar, Malta, South Africa and soon Latin America to vet these companies and it is no small task. Where there is any reasonable doubt as to the authenticity of the company or members of the company, the Board rejects the applications.

Since 2013, internet/online gaming has been regulated by the Gaming Board of Tanzania therefore forcing all companies that were operating in this manner to be regulated. One of the most important aspects of internet gaming is the software providers that provide the gaming platform to these companies. The Board also carries out a vetting on the companies that provide software and these companies need to also be licensed by the Board. The Board ensures that the technology is adequate and fulfils the requirements of the regulations in Tanzania, but also the Gaming Board has access to monitor the control systems, the servers whether or not they are located in Tanzania.

So hopefully, without having bored you too much, you are understanding that gaming is a regulated industry in Tanzania.

Firstly, we should remember that where there is noise against something, there is also (disgruntled) interest groups behind this noise.

Undoubtedly, betting is addictive, but so is alcohol, cigarettes, and many more. The misconception is that the addiction rate is so high that everyone who starts betting, cannot stop and enter into a vicious cycle of borrowing money, betting and hoping for the “pay out” that will change their lives forever. This is simply not true. Addiction happens to much fewer number of players than a lot and admittedly this is a problem and we must avoid that the number increases.

Contrary to popular belief, the solution is not to ban the industry as a whole since experience and history shows us that banning something usually translates into illicit and illegal activities known as the black market. Currently, the industry is regulated and banning it would simply mean that it would be underground, unregulated and the player will be at the mercy of opportunistic and ruthless bookmakers.

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