Online casino Piggs Peak plans to appeal Friday’s North Gauteng High Court ruling which bans online gambling in South Africa, drawing out an already lengthy battle to legalise their operations.
Piggs Peak’s Operations Director Lew Saul Koor said the company would not give up without a fight, in an email sent to all registered users of the site.
“On consultation with our senior legal counsel they agree that we should appeal this finding which we believe is totally incorrect,” the message read.
The appeal will allow Piggs Peak will to keep running their online gambling site during the legal process.
“Until the appeal has been heard and the outcome determined, our business will continue as usual as agreed with the Gambling Boards,” Koor said.
Illegal
The new judgement handed down on August 20 by Judge NB Tuchten stated that it would now become illegal to gamble using digital products in South Africa.
This means that online gambling operators in South Africa and players will be in contravention of the law, and could face a fine of R10-million or 10 years in jail, or both.
Gauteng Gambling Board’s head of legal services, Lucky Lukhwareni, told the Mail & Guardian that the debate over the banning started in October 2004 at the North Gauteng High Court, when Casino Enterprise (pty) Ltd also known as Piggs Peak and the Gauteng Gambling Board launched an application to determine where gambling starts.
“The action involved a determination as to where gambling takes place in respect of interactive transactions, (jurisdiction),” Lukhwareni said.
Piggs Peak, whose server is based in Swaziland, was of the opinion that online gambling begins where the server is based. Given that online gambling is legal in Swaziland but not in South Africa this definition of the jurisdiction would have made their operations legal.
Licence requred
But they were overruled, according to Lukhwareni.
“In November 2006 the North Gauteng High Court ruled in favour of the Gauteng Gambling Board stating that the interactive gambling games offered in Gauteng required a licence and since Casino Enterprises (Pty) Ltd or Piggs Peak did not have a licence to offer then, its activities were unlawful.”
Piggs Peak appealed this decision to the Supreme Court of Appeal (SCA) in Bloemfontein, who referred the matter back to the North Gauteng High Court, leading to the present judgement.
While critics have taken issue with the ruling, saying it was impossible to enforce, Lukhwareni said this was not the case.
“We can follow the US style wherein different stakeholders be warned to stop assisting these illegal operators,” he said. “Entities like the banks and the media.”
Victory
Meanwhile the Gauteng Gambling Board viewed the judgement as a victory for the gambling
industry.
“We have always been of the opinion that online gambling activities start where the punter is seated and concluded where the server is based, confirming that anyone proving online gambling to residents of SA must be licensed by SA,” they said.
Mediums that advertise online gambling will also be liable for a fine.
According to the Gauteng Gambling Board these could include internet service providers, banks and any radio stations, advertising agencies, print and online media facilitating advertisements for the industry.
South Africa’s biggest news website News24 stopped promoting online gambling advertisements earlier this year, after reviewing both the gambling legislation and the ongoing legal actions presented by various gambling operators.
Inevitable
“Our view on the matter was that the state would inevitably change the status quo to fall into line with current legislation,” General Manager of News24 Geoff Cohen told the M&G.
He said it was an easy decision to make.
“Marketing from online gambling operations formed a not insignificant portion of our online advertising revenue. However, we were by no means dependent on them as a revenue source,” he said.
The M&G online has also scaled back its online gambling advertisement over time, and will now comply with the new legislation.
“They account for a very small percentage of M&G revenue,” said sales executive Siphiwe Mathebula. “Our user response to online gambling has been very minimal thus resulting in early terminations of contracts.”