In a recent ruling by a high court in Mpumalanga, South Africa, the country’s National Lottery emerged victorious in its legal dispute against online betting group LottoStar. The court declared that LottoStar’s online offerings, which allow players to place bets on the outcome of the National Lottery, were in violation of the South Africa Lotteries Act. This ruling marks a significant victory for the National Lotteries Commission (NLC) and its operator Ithuba Holdings, who have been contending LottoStar’s operations since 2015.
Despite being licensed to operate online fixed-odds betting games, LottoStar is not a lottery operator, but instead sells tickets for games whose results are dependent on government-run lottery draws. The court’s verdict confirmed that no online gaming site can offer betting based solely on the outcome of a government-run lottery.
The NLC and Ithuba had argued that LottoStar’s lower tax rate of 1.7 percent on its gross ticket sales gave it an unfair advantage, allowing it to offer better odds and promotions to players than the government-regulated lottery. The National Lottery contributes 27 percent of its ticket sales to a trust fund that benefits non-profit organizations throughout the country.
Ithuba CEO Charmaine Mabuza expressed satisfaction with the court’s decision, saying it “reaffirms that only Ithuba as the National Lottery operator can lawfully offer bets on the lottery”. The company considers the verdict a precedent for challenging any bookmakers who derive financial benefits from accepting bets on the outcome of the National Lottery.
