SportPesa’s Kenyan operating licence is still unrenewed. The BCLB says the issue security clearance, something SportPesa says hasn’t been a factor before.

sportpesa license
Source: Cytonn Photography on Unsplash

Months after Kenya Revenue Authority (KRA) cleared bookmaker SportPesa for re-entry into the local market, the betting industry giant is still waiting to be issued with an in-date operating licence. The country’s Betting Control and Licensing Board – the BCLB – maintains that this is the fault of security agencies and not the BCLB itself. However, SportPesa Chief Executive Officer Ronald Karauri disagrees.

SportPesa’s Tax Clearance

Originally, the Gaming Bill 2019 stipulated that a new 20% tax be levied on bettors’ total stakes, rather than on their net winnings. This was to be paid by operators, and immediately drew the ire of several local sportsbooks who felt they wouldn’t be able to continue their business activities as usual.

Bookmakers went as far as saying that the new tariffs, and the withdrawal of licences until all outstanding fees were paid, created a hostile tax environment. Then the Nairobi-based Kenyan Tax Appeals Tribunal found that the 20% levy should be imposed on net winnings only.

At the time, Karauri stated that SportPesa encouraged Kenyan authorities to fully accept the tribunal ruling, and to take a reasonable approach to gambling taxation. Now, with the tax issues resolved, there appears to be a new problem with SportPesa’s licence.

Security Clearance Not Yet Granted

The BCLB’s Chief Executive Officer, Peter Mbugi, publicly explained that security clearance is the last stage before an operating permit is granted. Applicants have to comply with many other gambling operator licence requirements, and he added that no previously-approved firms would automatically be granted new licences.

In the wake of concerns that some betting firms were involved in illegalities, Mbugi continued, security clearance became a factor in the licensing process. Now, this is the only hurdle standing in the way of SportPesa’s operations. Since the vetting is done by security agents, Mbugi exonerated the BCLB of any blame in this situation.

Karauri’s Position

Karauri says his company was unaware of the security requirement clearance, and it was not part of any of their previous applications. He has also stated SportPesa is waiting for the BCLB to furnish them with details of what happened to their licence renewal request.

The sportsbook’s Chief Executive appears suspicious of the delay, adding that he hopes the security clearance was applied to all industry players and not just to his employer. For its part, the BCLB maintains that all applicants are treated the same and that the strict rules are in place to protect Kenyans and prevent problem gambling.

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