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IN THE HIGH COURT OF SOUTH AFRICA. GAUTENG DIVISION, PRETORIA. (1) NOT REPORTABLE. (2) NOT OF INTEREST TO OTHER.


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Casino Association of South Africa (CASA) - Financial Mail ePaper.


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CASA, Casino Association of South Africa, south africa. ABOUT US. Casino Review is the leading international media hub for the land-based and online gaming.


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The Casino Association of South Africa (CASA) has published its latest Survey on its members' casinos. CASA represents the interests of the country's legal.


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IN THE HIGH COURT OF SOUTH AFRICA. GAUTENG DIVISION, PRETORIA. (1) NOT REPORTABLE. (2) NOT OF INTEREST TO OTHER.


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IN THE HIGH COURT OF SOUTH AFRICA. GAUTENG DIVISION, PRETORIA. (1) NOT REPORTABLE. (2) NOT OF INTEREST TO OTHER.


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The NGB's strategic intent is to sustain and grow its regulatory capability to position South Africa as the pre-eminent jurisdiction with an exemplary and effectively.


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The NGB's strategic intent is to sustain and grow its regulatory capability to position South Africa as the pre-eminent jurisdiction with an exemplary and effectively.


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The NGB's strategic intent is to sustain and grow its regulatory capability to position South Africa as the pre-eminent jurisdiction with an exemplary and effectively.


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The Casino Association of South Africa (“CASA”) is calling on Government to adopt a zero tolerance approach to illegal gambling activities and.


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Tuchten J:. The effect of the decision was to increase the maximum number of casino licenses permitted in South Africa from forty to 41 and to increase the maximum number of casino licenses permitted in North West from four to five. CASA, on the other hand, maintained that an additional casino would simply cut the gambling revenue into smaller slices, to the detriment of its members, presumably because it believed that the gambling market had reached peak saturation. CASA's case on the papers is not that the Minister took the decision on one of the earlier dates. The final national gambling policy was published in the Government Gazette on 1 April The policy records the proposal that the Minister, in resolving the issue relating to the North West license, should allocate one additional license. The Minister told the meeting that his department, the Department of Trade and Industry the DTI , had not made any decisions regarding the number of licenses and requested proposals on a solution to provide North West with a fifth license "without going [beyond] the allocated forty". I agree that the argument was misconceived. There is nothing in these minutes to suggest that the Council discussed whether this should be achieved by reducing the number of licenses held by another province or by increasing the number of allocatable licenses from 40 to To achieve the result contemplated by the Council, however, either a re-allocation or an increase in the total number of licenses had to follow. I must also indicate that whilst research could be vital to decision making, it does not replace the decisions taken by policy makers and ultimately the legislatures. Section 45 of the Act, as we have seen, gave the Minister the power to determine the numbers of casinos both nation wide and in each province. Item 6 of the Schedule to the Act however preserved the number and provincial allocations of the casinos set by the Act until the Minister exercised the power conferred by s This is how and why a casino called in the papers the Morula Sun, which had formerly been in and supplied revenue to North West, came to fall into Gauteng. The minutes record that the Council had agreed at a meeting on 5 September that North West should be granted an additional license and that the DTI would write to North West informing it of the decision. Which of these views would eventually be proved correct could only be predicted or forecast at the time the Minister was called upon to make the decision. While s 45 of the Act obliges the Minister to take certain considerations into account, the measure is otherwise silent as to how, in the substantive sense, the decision maker may exercise the power conferred. They made presentations to the Council. Their case was that the decision had been unlawful because they had not been consulted and they deplored the drop in North West revenue the move had caused. But that case, it seemed to me had not been made on the papers. The Minister was not defending in those letters a s 45 decision, which had not yet been taken. The Minister observed that there might be a need to engage the National Treasury on this Issue. The Lotteries and Gambling Board established in , which became known as the Wiehan Commission Wiehan , was appointed to advise the government on a national policy for gambling in South Africa. The Minister also cautioned against the negative effects of gambling and the over-stimulation of gambling. Thirdly, that the Minister "did not assess the matter in a rational or reasonable way" in that he did not consider relevant information. CASA was opposed to the creation of an additional license and the expansion of the number of casino licenses. The more constrained the power, the more likely it is to be administrative. On this basis, then, the launching of the review fell outside the prescribed period of days. This figure was arrived at on the basis that one casino for every 1 million inhabitants of the country was appropriate. For example, In , the NGB expressed the view to the Minister that the number of forty should not be increased until proper research was conducted on the need for further gambling in the country. The National Gambling Act, 33 of the Act provided in s 13 1 0 that there were to be a maximum of 40 casinos nationwide, with six in Gauteng and five in North West. This provision requires that a PAJA review must be brought not later than days after the date on which the aggrieved person was informed of the administrative action, became aware of the action and the reasons for it or might reasonably have been expected to have become aware of the action and the reasons. For obvious reasons, this would have an extremely negative effect on investor confidence and the stability of the casino industry in general. At a later stage in their opening argument, counsel for the applicant referred me to para I think that the concession was properly made. Kwa-Zulu Natal expressed the view that North West's claim was legitimate but that claim should be balanced against the negative effect of gambling and the duty to guard against the over-stimulation of gambling. This inevitably meant. It describes how before , casino gambling was illegal in South Africa but legal in its neighbouring states and several of the homelands, with the result that South Africa lost revenue to casinos outside its then borders. CASA responded to this invitation, in essence repeating its earlier objection. Only if it cannot achieve consensus, may it resolve a matter before it by formal vote. The Mafika report, as it was referred to in argument, was made available to the Minister in Mafika concluded that there was R million of potential gaming revenue that either was being spent in other provinces or was not being spent at all. That means that the Minister's decision falls to be reviewed and set aside on two further grounds:.{/INSERTKEYS}{/PARAGRAPH} Secondly, that the decision was motivated by a single, improper so CASA says concern: in the provincial boundaries had been altered so that a casino which had initially operated from ground North West thereafter fell in Gauteng; and the Minister acted to right that perceived historical wrong. Gambling was the second biggest generator of provincial "own revenue". It is CASA's view that the award of another license in the North West Province will open the flood gates for similar demands in other Provinces, setting a harmful precedent for the future of what is currently a stable industry operating within known parameters. I therefore need not deal with this argument in any detail. The DTI officials too were against the increase. The Act repealed and replaced the Act. There was no other way to achieve the result on which the Council had agreed. A discussion followed which focussed mainly on the revenue stream which might have been lost through the re-allocation of the Morula Sun, the acceptable or appropriate number of licenses which should be allocated, the socio-economic impact of gambling, whether North West would be able to grant an additional license and, if so, whether an additional North West casino would be efficient and sustainable. It is of the utmost importance to stress that certainty regarding the number of casino licenses is absolutely crucial to the stability of the industry, as well as for investor confidence. The task of the Minister and the regulating authorities is to balance these factors. It is clear from the record that the probably unintended and unforseen consequences of the move of the Morula Sun to Gauteng required the Minister to undertake fairly complex negotiations with a wide range of interested parties whose interests in certain important respects were in conflict. It consists of the Minister as chair and one of a number of "regular members", together with the members of the executive councils of the several provinces responsible for casinos and other forms of gambling and others as non-voting members. This shows that circumstances had significantly changed since the GRC had reported. At the time the GRC reported, the number of persons gambling had dropped from earlier levels. In the same notice, the Minister set the maximum number of casino licenses in the North West Province North West at five. Of course the population of South Africa had increased from its number but the GRC, while remarking that the figure of forty had based on an assessment that one casino to every million inhabitants was appropriate did not go into great detail in this regard. As I have set out, the decision was formally published on 10 June Counsel for CASA submit that the decision was administrative, rather than executive, action. {PARAGRAPH}{INSERTKEYS}In the matter between:. As I have pointed out, a maximum of forty casinos in number was fixed in the Act. Counsel for the Minister and North West adopted the contrary argument. The issue of North West's lost revenue stream and the requirements imposed on the National Treasury was discussed. Counsel accepted that the argument mischaracterised CASA's case. What took place before that date is, on CASA's case, merely evidence of the allegedly flawed nature of the Minister's action. It suggested that Hartebeespoort or Potchefstroom would be suitable locations for the proposed additional North West casino. The undeniable fact is that every gambling venue potentially increases the potential for gambling of a kind and to the extent which can adversely impact on gamblers and their families. So, in , casinos in North West received R49 million in gambling levies. The section reads:. In response, the minutes record that the Minister proposed that North West be allowed to make a presentation at the next meeting but that it should be born in mind that the three licenses which were not in use were held by other provinces which were in the process of utilising the unused licenses. In terms of section 87 of the National Gambling Act, , public comment must be sought on the matter. It is that the Council took the decision on the earlier date and the Minister adopted it without applying his mind to the matter when he published the regulation on 10 June ; or that the Minister failed to consider the factors he was obliged under s 45 to consider; or that the decision was irrational. The main ground for the recommendation of the GRC that the maximum number of forty casino licenses should be retained was [8] that of the forty permissible licenses, three were not in use. He was defending the Council's recommendation: its advisory decision. The third and fourth respondents abided. The catchment area of North West, Mafika concluded, was such that it was probable that an additional casino in North West would be profitable. He told them that he was considering increasing the number of casino licenses by granting North West the fifth license which it had lost when the Morula Sun had fallen under the jurisdiction of Gauteng. The GRC was appointed by the present Minister in to, amongst other things, review the evolution of the gambling industry since , assess its social and economic impacts, with social reference to the demography of gambling participants, the incidence of gambling addiction and associated problems, youth gambling and the effectiveness of then current strategies to mitigate the negative effects of gambling and to assess the proliferation in South Africa of both licensed and illegal activities and to what extent the various regulatory bodies had met their legislative objectives. They commissioned reports on the subject and engaged the Minister in correspondence advocating their position. The Minister merely gave effect to that decision. At the same time, regulated gambling had become and surely still is a vital generator of revenue, job creation and infrastructure development in South Africa. KPMG concluded that there would be a r1egative effect on North West and suggested that this be offset by a revenue sharing arrangement with Gauteng. But I must say that the letters written by the Minister, which counsel for CASA closely analysed and on which they based their erstwhile main argument do not bear out the factual contention. Paragraph It is apparent that the Minister did not take the Decision - the [Council] did. One of the functions of the Council is to operate as a forum in which the national and provincial governments consult on a range of gambling-related issues including those relating to gambling policy. But by the time the GRC had reported, the power to set the number of casinos in the country as a whole and in each province was conferred upon the Minister by s 45 of the Act. A decision was taken to replace the casino license lost by the North West Province as a result of the municipal border demarcation resulting on the relocation of the Morula Sun to the Gauteng Province. For example, a decision maker who has taken into account the considerations specified may in a proper case accord those considerations scant or even no weight and may base the decision on considerations not mentioned in s 45 at all. The GRC reported to the Minister in Its report was considered in Parliament. A notice to this effect will be published in due course inviting the public and relevant stakeholders to comment on the proposal. Would that not, I asked, amount to a submission that the Minister had been party to dictating to himself, which seemed to be a logical impossibility? Their view, expressed in a briefing submission to the Minister submitted in for a meeting in July was that the revenue lost by North West was not significant and that the maximum number of forty should not be increased until research had been conducted. Wiehan reported in As a result of Wiehan, casino gambling was made legal in South Africa and the predecessor to the Act, the Act, was enacted to regulate gambling in South Africa. The decision was taken by the Minister, counsel conceded, but he had, counsel submitted, closed his mind to further submissions, particularly by CASA after the Council meeting.