Speaking for Africa: The AIA on achieving continental harmonisation

Peter, a proud moment to be elected and to move on from the Botswana Gambling Authority where you’ve worked for many years. Do you think that the regulatory and industrial challenges faced by operators in Botswana are scalable to this Pan-African mission with the African iGaming Alliance? 

Yes I do, and if I may give you some background – I’ve been a member of the Gambling Regulatory Africa Forum (GRAF) board, which is an association for all the regulators in Africa. Plus, I was also a board member of the International Association of Gambling Regulators, and you find that the issues operators in Africa face are the same.  

The operators who make up the membership of the African iGaming Alliance, they operate in different countries in Africa, and all find that issues of taxation, the application process, are quite difficult. So, in that way it stifles the innovation of the industry. At GRAF, we are awake to the idea that the industry is ahead of us as regulators. So, I say this gives me a plus because I’ve been a regulator and at a regulator level. What we are basically saying is that we should help those that are in industry to ensure that they attain the objectives of employment, and help government in terms of getting their taxes. I’d say my experience will come in handy.  

And will you be doing some sort of official widespread consultation with industry? Or do you feel confident that you already know how you can help operators and that you have the resources to achieve those objectives? 

I believe I can execute the objectives of the Alliance. There are key arguments around Pan-African iGaming. One is that the taxation for operators is quite high. Then the other thing is that when you tax the players, they go to the black market, to operators that are not licenced and do not pay taxes. This is not sustainable in terms of taxation and it burns the consumers. In my other life as a regulator, we at GRAF level, we felt that we should be an enabler to the licensed operators. These are organisations that are creating jobs, they are paying taxes. They are doing a lot of CSR. So I believe that regulations should just be an enabler and not a barrier. It should be fair, it should be transparent, the rule makers should know that this drives the growth and investment. 

We need more FDI (foreign direct investment) in Africa. The other thing is around the stakeholders. It’s very important that as the CEO of the Alliance, I should ensure that I collaborate with the local or the national gambling or iGaming association. If there’s an association in Nigeria, I should ensure that we collaborate, I should be collaborating with the regulators, where possible, even governments just to show them the pros and cons of this industry. When you look at roughly what Africa loses annually to the black markets or unlicensed operators, according to the H2 it’s like around $2 billion annually. 

The main issue is going to be around taxation. Harmonising the rules around that I don’t think should be an issue, because it’s something that the regulators in Africa had already started

With issues of player protections, issues of responsible gambling, issues of problem gambling, often governments tend to think the problem is the licenced operators, but the problem is the black market unlicenced ones. When there are issues of problem gambling, now the consequences are borne by the licenced industry while in actual fact, the players in question were playing with unlicensed operators. Government should also benefit from collaboration around enforcement, so it’s very important that we are all aligned. 

What do you feel are going to be the hardest arguments to win that you kind of need to win across Africa?  

What is important is that people should talk more on the positives. For example, the Alliance combined employs 5000 directly – not through the value chain – 5000 directly. In the 20 countries they operate in collectively they pay taxes worth $500 million, annually. So these are some of the things that should be brought to the table when we engage with the regulators, when we engage with the governments. I think the most difficult issues come mainly because of stigma. The taxation in the industry is normally called cent tax, so that I think is going to be quite a tough one, having to convince governments to at least keep the taxes between 15% and 25%. In Rwandan gaming policy, there is a document whereby Rwanda intends to take the gambling taxes from 13% to 40%. If you increase the taxes and you tax the players, all these objectives of the Pan-African alliance will be defeated.  

Governments perceive that gambling makes a lot of money, but in actual sense on average, out of the wages and bets, on average 80% to 90% goes to the winners. So the margins are quite small because there’s winnings. But then when they see the total wages and bets sitting at billions, they think there’s a lot of money. There are also some overheads, some CSR. So the main issue is going to be around taxation. Harmonising the rules around that I don’t think should be an issue, because it’s something that the regulators in Africa had already started.  

I also happen to sit on the Africa Regulatory standardisation organisation. And hopefully I’ll continue because I’ve been in touch with them. That body is a combination of regulators, operators and government representatives. It’s set under the African Union, so with my sitting in that executive committee, I think it will help. It will not be easy to get all this done, but I believe if we have a trade body like the African iGaming Alliance with members operating in 20 countries, I think we will be the voice of the industry.  

The Gaming Alliance Africa, a very similarly named association with similar targets. They too, have positioned themselves as a continental Pan-African industry alliance. Have you had specific contact with them?  

Yes, we will be contacting similar bodies such as that that one. What is important is that at the end of the day it’s the industry that really wins.  

You don’t foresee any friction in the way you want to achieve your objectives?  

No, you’ll find that maybe in terms of its membership we are operating in 20 countries. Maybe they’re in different countries. I think there will be synergies along the way, that’s what I believe.  

For example, the AIA, the founding members is Betway, Africa888, SportyBet and BetPawa. So they are actually competitors, but they’ve come together with a mission. They know we need a body that can drive some of these key issues such as your monopolies, payment aggregators and issues of responsible gambling. Outside the alliance, they are competitors, but important operators, regulators, governments, we need to work together. I believe for the other alliance it’s something that is doable. I will also be engaging them soon. 

We may need to sign an MOA (Memorandum of Agreement). We may need to sign an MOU (Memorandum of Understanding) to see how we can also collaborate. There are other bodies that have already contacted us too that are non-for-profit, mainly focusing on issues of responsible gambling. So we need to work together on this one.  

In Rwandan gaming policy, there is a document whereby Rwanda intends to take the gambling taxes from 13% to 40%. If you increase the taxes and you tax the players, all these objectives of the Pan-African alliance will be defeated

Do you have plans to arrange any conferences bringing industry together and align the conversations taking place in the sector?  

Yes. Because we recently launched, we will be meeting and introducing ourselves to all the regulators in Africa, to all the local association, as well as the alliance we just spoke about. I’ll be attending the International Association of Gaming Regulators conference in Canada in October where we will have a session with the regulators from Africa. We also intend to launch our Alliance in November at the Gambling Regulatory Africa forum meet, which will be in Sun City. We’ll be attending that, dealing with the regulator, but in the meantime, we are looking for a time to call all the associations so that we can meet. My vision is to have some similar Responsible Gambling Weeks across Africa. So those are just some of the things that we will be doing going forward.  

In closing, the African iGaming Alliance exists to make this gaming vision practical, inclusive, and future focused. And my commitment is to ensure we build an institution that endows and delivers value to every stakeholder in this ecosystem.