Gambling Operators in South Africa Have Mixed Reactions over New Gambling Laws

south africa

South African lawmakers are looking into relocating the country’s casinos to the Trade Bay area and the eastern region, which have been recently established. Many local gambling operators have registered their disappointment with this decision.

Mixed reactions over the bill

Gambling operators are opposed to the new bill (Western Cape Nineteenth Gambling and Racing Amendment Bill, 2018). If it is enacted, they claim, it would result in a slump in gambling revenue, as well as a fall in profits and the loss of jobs.

The bill was drafted as an amendment to the current Western Cape Gambling and Racing Act of 1996, which gives the Western Cape government the right to relocate the casinos in the province to other regions.

Many of the casino operators based in South Africa, for example, the Sun International and the Tsogo Sun Holdings Ltd., have mixed reactions and opinions about the impact the bill’s implementation might have to their operations. The proposed bill, as of the time of its writing, has not been presented to the legislative committee.

Relocations supported if they make commercial sense

Jacques Booysen, who is the CEO of Tsogo Sun, has said the company is willing to support the relocations of the casino from the Western Cape, but only on the condition the relocation is carried out in a way that will make commercial sense for the casinos.

Tsogo Sun, which is the biggest casino operator and hotel in South Africa, has been taking steps toward reducing its currently mounting debts. One of the ways it has been striving to achieve this is through halting its business expansion plans and acquisitions. The company has also decreased its expenditures by 8 percent in the last year. This percentage has effectively reduced its spending to $261.5 million.

The company will be submitting its official comments on the bill once it has gone through the draft legislation, which would be before July 31, according to the chief executive officer.

The Sun International, which is the GrandWest Casino operator, has vehemently opposed the planned relocations of its competitors. The company has stated this relocation may result in lower profits being realized by the casinos, as well as more loss of jobs in the near future. Its CEO, Anthony Leeming, has reported that should the bill be approved, Sun International would stand to lose at least 24 percent of its gross gambling revenue and experience a headcount drop of up to 15 to 20 percent.

He has said the GrandWest casino will experience a majority of the job losses while a decrease in foot traffic will also affect other jobs that deal with operations support at GrandWest. He has said this eventuality is very possible considering these businesses rely solely on the casino-generated foot traffic.

Relocation will affect the local economy

The owners of the casinos that are located in the province’s five district municipal regions each had licenses granting them permission to operate casinos exclusively for a period of 10 years. This period has since expired. Proposals for the availability of casino licenses in the Trade Bay and eastern regions are now being made.

Upon being asked as to how the local economy will be affected by the relocation of the casinos, MEC Alan Winde said the process would require careful consideration. He said one of the provisions that would need to be considered is exactly what would happen to the people who remain behind after the casinos have left.

Many of the casinos in the locality have been praised as having had a hand in the building of roads and in contributing positively toward the social projects in a number of schools.

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