Uganda Plans to Nationalize Its Land-Based and Online Gambling Industry

Friday, May 31st, 2019 | Written by April Bergman
Uganda Plans to Nationalize Its Land-Based and Online Gambling Industry

The government of Uganda plans to nationalize the country’s gambling industry. The Ugandan Finance Minister, Matia Kasaija, called on the National Gaming Board Uganda (NGBU) to stop issuing gambling licenses.

Finance Minister Kasaija also called on the NGBU to allow the existing gaming licenses to expire without renewal. Matia Kasaija said that Uganda opened the nation to overseas gambling operators, but those operators drain most of the revenues and leave little for the tax collector.

Such a situation is insupportable, according to the finance minister, so Uganda will nationalize the gaming industry and collect revenues directly. Essentially, the National Gaming Board Uganda should cut out the middleman.

Along with the nationalization process, Uganda plans to institute stricter regulations for gambling. Problem gambling among underage and young adult gamblers is rampant, says the cabinet minister, so age restrictions and age verification policies will be added.

Must Be 25 or Older to Play

Uganda’s state-controlled land-based and online gambling operators cannot allow a person to play unless they can verify they are 25 years old or older. Such people must provide their government-issued identity cards.

For online gamblers, the process would be similar to offshore online casinos, sportsbooks, and poker sites when a person requests their first withdrawal. The punter must fax or scan their identity card to the site operator, who therefore verifies its authenticity.

Players Must Register Phone Numbers

Players also must register their phone numbers with the government’s central monitoring system. While that sounds like a step further than most gaming sites, it actually falls well within the parameters most sites set. Registration forms always ask for a phone number, along with physical and email addresses.

Uganda’s change of gambling laws in some ways mirrors that of its next-door neighbor, Kenya. Kenya recently banned all gambling advertisements on television, radio, billboards, and online sites.

Changing Gaming Laws: Uganda and Kenya

Though the policies invoked are much different, the reason behind them is the same. In both cases, they policies combined fear online and smartphone gambling is harming the younger generation. Both sets of laws also show a deep distrust of international gaming operators.

Kenya opened the door to offshore operators, but found that many underage and young adults gamblers face problem gambling now. As much as 70% of Kenya’s problem gamblers are 25 and under. The gaming addicts use smartphones on mobile sports betting sites, hoping to score the one big bet which turns their fortunes.

Lessons from Uganda’s Gaming Policies

Both Uganda and Kenya should serve as an object lesson for offshore online gaming sites. Placing short term profits over long term viability is a bad strategy. Uganda now nationalizes its online gambling industry, leaving many of the operators without customers.

While history shows the state-run gaming operations often do not protect citizens any more than commercial operators, that is more easily swept aside by state officials and bureaucrats. Uganda’s Finance Ministry will run the gaming sites and collect their revenues. Whether the money goes to good causes, or Ugandan youth will be better served, is anyone’s guess.

In either case, it should serve as a reminder that the licensed gaming must serve the cause of the state and the society with which it interacts.