PROGRAMME 1: GAMING CONTROL AND COMPLIANCE DIVISION (GCCD)

Purpose of the programme

The Gaming Control and Compliance Division (GCCD) provides mandated operational core functions in terms of the National Gambling Act, 2004, (Act 7 of 2004). The GCCD provides technical analysis of the modes of gambling and system audits in line with statutory imperatives as provided for in gambling legislation. It provides reliable information through national centralised databases and contributes towards providing accessible, transparent and sufficient access for economic citizens to ensure the ease of doing business. The sub programmes of the GCCD are set out as follows:

Functional National Registers

The NGB is the custodian of national registers in terms of the NGA. The NGA requires that the NGB must establish and maintain, in the prescribed manner and form national registers to provide a national repository of gambling sector-specific information. The NGB is required to provide the information in its registry to PLAs in the prescribed manner and form to ensure information sharing and compliance as contemplated in the NGA.

National Central Electronic Monitoring System (NCEMS)

The NGB is obliged by section 27 of the NGA read with regulation 14 of the National Gambling Regulations to supply, install, commission, operate, manage and maintain a National Central Electronic Monitoring System (“NCEMS”) which is capable of detecting and monitoring significant events, associated with any LPM that is made available for play in the Republic and analysing and reporting data according to the requirements of sections 21 to 26 of the NGA. NCEMS is essentially a system to track each LPM operated by a Route Operator (RO) or Independent Site Operator (ISO) in terms of location and status; record and validate every transaction on the LPM in real-time, and periodically report collected data. The NCEMS enables the NGB to fulfil its oversight responsibility over the PLAs in terms of section 65 of the NGA, maintain the national register in terms of section 21 of the NGA, monitor and evaluate the PLAs compliance with the NGA and enables the NGB to assist the PLAs to detect and suppress unlawful gambling and unlicensed gambling activities.

Gaming Control

The NGB will monitor and analyse technological developments that affect gambling regulation and provide advice on the compliance of gambling machines and devices in terms of the NGA. The NGB will review and analyse the certification of gambling products, new gambling products, and the adoption of technology in the gambling industry in accordance with the technical standards (SANS1718) developed by the

South African Bureau of Standards in accordance with the Standards Act.

Compliance

Provincial legislation supports the NGA in regulating the industry. It has however been noted that not all provincial pieces of legislation support the NGA as contradictions have been observed between provincial legislation and the NGA. Through S65, the NGB will provide an authoritative advice on policy, statutory matters and legislative reform in the Gambling Industry. GCCD therefore has an important role during the evaluation and monitoring of performance of PLAs to identify discrepancies, issue deficiency notices and where necessary, make recommendations to the National Gambling Policy Council (NGPC).

The PLAs have sole legislative mandate to issue national and provincial gambling licences. It is paramount that applicants of these licences are properly vetted to ensure that there is compliance with the law by ensuring the following:

· Legality, responsibility, fairness, transparency and honesty;

· Equity and elimination of unfair competition;

· Protection of communities, vulnerable persons, public interest;

· Consideration of public objections;

· B-BBEE compliance with respect to ownership and job creation, amongst others, which entails ensuring that historically disadvantaged individuals (HDI) are advanced and participate in the greater economic activities;

· Suitability of applicant and its employees;

· Suitability of licensed premises, location, proximity between other gambling establishments; and

· Measures are implemented to combat addictive and compulsive gambling.

Financial flows are created by various gambling related transactions that may involve the diversion of resources away from economically- and socially-productive uses and these diversions can have negative impacts on the gambling and financial sector and external stability of the industry and the state. AML/CFT controls, when effectively implemented, mitigate the adverse effects of criminal economic activity and promote integrity and stability in the industry. This will be accomplished by ensuring the compliance by PLAs with the Financial Intelligence Centre Act specifically with Sections 21B, 29, 36, 42,42A and 45.

The NGB will ensure compliance with section 33 of NGA which requires the NGB to evaluate the issuing of national licences by PLAs and the compliance monitoring of licensees by PLAs. The section further requires the NGB to conduct oversight evaluations of the performance of PLAs, in a manner stipulated in section 34 of the

NGA so as to ensure that norms and standards are applied uniformly and consistently by all PLAs.

PROGRAMME 2: ENFORCEMENT

Purpose of the programme

The programme monitors the integrity of the processes and provides inputs in the development and maintenance of gambling technical standards. This programme is mandated in terms of the NGA to undertake co-operative activities to prevent and suppress illegal gambling activities and investigate suspected cases of unlawful gambling activities. Furthermore, the programme facilitates resolution of disputes as an effort to ensure fairness in the gambling industry.

Input to the technical standards committee

The South African Bureau of Standards (SABS) is the national institution for the production and maintenance of technical standards in South Africa. The SANS 1718 family of standards apply to the gambling industry. The NGB is mandated by section 22 of the NGA to ensure that all gambling machines and devices that are registered in terms of the NGA are certified as complying with the relevant standards (SANS 1718) for such machines and devices. Therefore, participation by the NGB in the SABS TC 1095 activities adds much needed value to the industry.

The NGB therefore participates as member of the Technical Committees listed. Participation aids the NGB in monitoring and influencing standards development for the benefit of regulated industries. Participation in the SABS standards development, SANAS assessment of test laboratories and NRCS, as well as regular engagement with NRCS will provide the NGB with important intelligence in the processes relating to the gambling product value chain.

Interventions implemented to protect the gambling industry

The South African gambling industry consists of nine (9) PLAs who are established by provincial gambling legislation to regulate gambling (excluding lotteries). Within their jurisdiction, each PLA is exclusively responsible to:

· Ensure that unlawful activities related to casinos, racing, gambling, and wagering and unlicensed gambling activities are prevented or detected and prosecuted.

· Conduct inspections to ensure compliance with the NGA, applicable provincial law and conditions of national and provincial licenses issued by it;

· Impose administrative sanctions on licensees in accordance with the NGA and applicable legislations; and

· Issue offence notices in respect of offences in terms of the NGA.

The NGB is mandated to assist PLAs to ensure that unlicensed gambling activities are detected, prevented, and policed. Further, the NGA provides for the establishment of the national inspectorate, the appointment of the national inspectors and functions of the national inspectors as stipulated in S76 and 77 of the NGA.

In the execution of the NGB’s responsibilities as stated in the above paragraph, the Enforcement Division intends to engage with relevant enforcement agencies to facilitate reporting and investigations of detected illegal gambling activities. Together with the PLAs and relevant enforcement agencies, the ED will be embarking on national inspections on unlicensed operations to gather information required to register enquiries and initiate investigations by the SAPS. Regular meetings will also be held with relevant agencies to monitor and provide status updates on the implementation of the national strategies intended to address illegal gambling activities.

There is an increased trend observed in the betting industry involving betting on live casino games as well as offering interactive games by some bookmakers in the country. Same is advertised on national television as bets taken on the outcome of a contingency. These games are online/interactive gambling, an activity which is prohibited in terms of the NGA.

Most of the legislated compliance requirements for systems and equipment used in these games are not taken into consideration in line with the provisions of the NGA. Thus, the ED will be embarking on an in-depth analysis of compliance considerations undertaken by the licensing authorities when authorising the said activities by its licensees and accordingly provide recommendations based on the outcome of the investigation and when necessary, take legal action.

Targeted investigations completed on the circumstances of illegal gambling activity

The NGB has the sole mandate to investigate and make a determination whether the NGAivity undertaken on a reported unlawful winnings matter was indeed unlawful in terms of the NGA.

The ED will further ensure, in complying with section 16(4) of the NGA, that the circumstances of the gambling activity of any winnings withheld and remitted to the NGB are investigated and if found to be illegally obtained, such funds will be forfeited to the State.

Unlawful winnings are remitted to the NGB by banks and other gambling establishments in terms of Section 16 of the NGA. Upon receipt of the following documents from the reporting institution the matter is recorded and prepared for investigation:

· Notification;

· NGB2 form; and

· accompanying documents as prescribed in Regulation 6.

Once a determination has been made regarding the NGAivity undertaken, the NGB will either:

· apply to the High Court for an order to declare that the winnings are forfeited to the State, where the activity is found to be illegal; or

· refund the monies won to the relevant party, where the activity is found to be legal.

The ED is tasked with amongst others, the investigation of the alleged proceeds of unlawful gambling. The investigation is informed by the process outlined in the approved unlawful winning standard operating procedure. Therefore, the ED will ensure that the targeted investigations are completed within 30 days from receipt of complete documents.

Monitoring of updates made on IGOR

Although no reference is made to an Illegal IGOR in the National Gambling Act, 2004 (Act 7 of 2004), the National Gambling Board (NGB) was instructed in the Shareholders Performance Compact signed between the Department of Trade and Industry (referred to as the dtic) and the NGB, Financial Year (FY) 2016 to develop a register of illegal operatives and blacklist them so that they are not considered in future licence applications. The NGB is furthermore also tasked to combat illegal gambling, and especially online gambling in South Africa. This project has a direct bearing in fulfilling that mandate. The ED will therefore maintan the register of the detected illegal gambling activities. The ED will therefore monitor the updates made on the register and report on the detected illegal gambling activities.

Resolution of disputes and response to public enquiries

There is a rise in unresolved gambling related disputes that may cause reputational damage to the gambling industry. Through the NGB information email address, disputes are received from the public, which the division then assess and refer to the relevant agency.

The objective is to ensure prompt resolution of the disputes and provide necessary assistance to the public enquiries. The NGB will continue to maintain the disputes database and refer disputes to the relevant licensing authorities and ensure timeous response to public enquiries, with the objective to ensure that the members of the public participating in any licensed gambling activities are protected.

PROGRAMME 3: CORPORATE SERVICES AND RESEARCH DIVISION (CSRD)

Purpose of the Programme

The Corporate Services and Research Division (CSRD) provides mandated operational core functions in terms of the National Gambling Act, 2004, (Act 7 of 2004). The division specifically provides a broad-based public education and awareness programme as well as an economic analysis of gambling sector performance of the industry. The CSRD provides support services to the NGB to ensure satisfactory internal and external stakeholder engagement, and seeks to attain a conducive work environment, which enhances business efficiency. CSRD comprises of the following subdivisions, Human Capital Optimisation (HCO), Legal Services, Research, IT, and Corporate Governance. The sub programmes of the CSRD are set out as follows:

Legal Services

Legal Services provides corporate legal services to the NGB in form of legal opinions, legal advice, legislative drafting, litigation, drafting and vetting of contracts and records management. Legal Services ensures that NGB’s interests are promoted and protected in its business operations and further ensures that the NGB operates within the ambit of the law. Records Management ensures that there is proper maintenance of records, access to and protection of information.

Corporate Governance

The Corporate Governance coordinates implementation of Planning and Reporting Frameworks to enhance the effectiveness and efficiency of governance and achievement of performance deliverables. Corporate governance also focuses on Risk Management to assist with identification, assessment and mitigation of strategic, operational and reputational risks that may hinder the NGB from achieving its objectives.

Information and Communication Technology

The function of the ICT unit is to support the NGB in matters of ICT strategic development and maintenance of the communication and management systems, thereby safeguarding the assets of the NGB. The unit ensures that the ICT support functions are carried out in a manner that supports the strategic objectives and the mission statement of the NGB. ICT is geared at supporting and enhancing the overall organizational performance through the provision of assistive technologies.

Human Capital Optimisation

HCO focuses on integrated management of the work environment in order to optimise and nurture human capital to ensure business efficiency is obtained and ensure that there is a conducive environment wherein balanced labour relations are maintained.

Research and Advisory Services

Mandated in terms of S65(1) and S65(2) of the NGA, the NGB monitors socio-economic patterns of gambling activity within the Republic; monitors gambling sector performance, market share and market conduct in the gambling industry. A broad-based public education programme about the risks and socio-economic impact of gambling will be facilitated through educational campaigns. The aim is to maintain social dialogue with industry stakeholders on the consequences of the overstimulation of gambling, compulsive and addictive gambling, and the negative impact of participating in any unregulated gambling activity.

PROGRAMME 4: FINANCE AND PROCUREMENT

Purpose of the Programme

This programme provides strategic financial management support and procurement services to the organisation. Finance and Procurement Services facilitate the overall management of the NGB and provide strategic financial management support to the organisation. It is the custodian of financial resources. The division comprises of two units that provide specialised support services to the NGB.

The NGB, as an agency of the dtic and an organ of State, strives to be a cautious steward for the management of State resources allocated to it to carry out its mission. Section 74 of the NGA provides an opportunity for the NGB to grow its revenue base in addition to its grant allocation, the collection of any fees payable, or any other money accruing to the NGB from other sources.

The Finance and Procurement Services division combined the performance expectations outlined in the Business Plan with the fiscal accountability demonstrated by its ability to design and implement a financial model that alleviated its sole dependency on a grant allocation. It was crucial for the NGB to manage statutory reporting requirements and achieve its performance with great financial accountability.

The Finance and Procurement Services division combined the performance expectations outlined in the Business Plan with the fiscal accountability demonstrated

by its ability to design and implement a financial model that alleviated its sole dependency on a grant allocation. It was crucial for the NGB to manage statutory reporting requirements and achieve its performance with great financial accountability.

The following sub-divisions contribute to the provision of services by the Finance and Procurement Services:

Finance

The Finance sub-programme maintains reliable financial records which are prepared regularly for both internal and external stakeholders. These financial records are presented to external auditors annually to obtain an independent opinion on whether the NGB’s financial records fairly present the state of its financial position, performance and cash flows. The NGB achieved a clean audit for the 2022/23 financial year, which is consistent with performance since 2015/16 FY.

Procurement

The Supply Chain Management (SCM) sub-programme endeavors to procure goods and services in a manner that is fair, equitable, transparent, competitive and cost-effective. This is achieved by ensuring that goods and services procured are in line with the objectives of the NGB as set out in the Strategy and Annual Performance Plan. The SCM sub-programme also ensures that all procurement prescripts are complied with and that all SCM reporting requirements are met.

Internal controls include Finance and SCM strategies, policies and procedures which are reviewed annually to ensure their continued effectiveness and compliance with statutory requirements. These controls are tested by internal auditors to verify that they are adequate