The Pretoria High Court has dealt Ithuba Lottery a blow when it dismissed its urgent application to block Sizekhaya Holdings from becoming the next lottery operator.
Sizekhaya Holdings was awarded a multibillion-rands tender as the new licence operator by Minister of Trade and Industry Parks Tau and the National Lotteries Commission (NLC).
In its application, Ithuba argued that Tau and the NLC had committed procedural errors in evaluating bids for the fourth national lottery licence.
The company claimed the process was flawed and sought an order to halt the transition.
However, Judge Ronel Tolmay dismissed the application, paving the way for Sizekhaya to continue its transition to become South Africa’s next lottery operator.
In the judgment, Tolmay found that Ithuba had not demonstrated a “clear right” or even a “prima facie right” to justify an urgent interdict.
“Ithuba did not meet the requirements for an interim interdict. It did not show a clear right.
“There is no indication that Ithuba will suffer irreparable harm if the interdict is not granted, and the balance of convenience does not favour Ithuba. The review court can still provide adequate relief,” the judgment reads.
Tolmay stressed the principle of judicial restraint in reviewing administrative decisions.
She stated that the courts are tasked with scrutinising government actions but must avoid stepping into the shoes of administrative authorities.
Quoting legal scholar Hoexter, Tolmay argued that courts must not move from “review to appeal” or “usurp the functions of administrative agencies”.
She said this principle weighed heavily against granting Ithuba the exceptional relief it sought.
On Ithuba’s complaints regarding funding requirements, bid evaluation, and quality assurance processes, the court noted that many allegations were disputed.
Both the minister and the NLC offered competing explanations, making it impossible at this stage to conclude that the licence award was unlawful.
The judgment emphasised that such contested issues are for the full review process, not an urgent application.
The court also rejected Ithuba’s claim of irreparable harm, describing any potential losses as commercial risks inherent to the lottery industry.
“The risk faced by Ithuba is a commercial risk which is part and parcel of this high-risk industry,” the judgment reads.
Sizekhaya had already started implementing its licence transition in June, shortly after signing the agreement in May.
The court said Ithuba’s delay in raising its objections weakened its claim of urgency, describing the attempt to halt the process as “self-created urgency”.
Public interest played a decisive role in the ruling. Ithuba suggested a temporary licence could be issued while the review proceeds, but the court rejected this as “not viable”.
Implementing a temporary licence requires a full competitive process, which recent court cases have shown can be unpredictable and legally complex.
The judge warned that halting implementation would mean “the national lottery cannot operate and this will be prejudicial to the public interest”.
Ithuba offered R50-million to cover any losses Sizekhaya might incur if the interdict were granted, but the court agreed with the latter that the sum was “wholly inadequate”.
While Ithuba has lost its urgent bid, the company’s legal challenge is not over.
Its full review application, seeking to have Tau’s decision reconsidered, will still be heard.
For now, however, Sizekhaya remains firmly in the driver’s seat, and the transition to the fourth national lottery licence continues without interruption.
