High Court declares Lottostar activity illegal

Johannesburg – In a landmark judgement on 31 August 2021, the High Court in Mbombela has declared the activities of Lottostar to be unlawful and has interdicted them from offering bets on the outcome of any lottery.

The matter has been before the courts since 2015, which have now found the conduct of Lottostar to be in contravention of the provisions of Section 57 (1)(a) and (b) of the Lotteries Act no 57 of 1997.

The Act also defines an illegal lottery as any game of chance not authorised by the National Lotteries Commission.

The impact of illegal lotteries on good causes

The National Lottery contributes approximately 27% of the funds raised to the National Lottery Distribution Trust Fund (NLDTF), which is distributed to good causes to uplift communities across South Africa.

Illegal lotteries do not contribute to the NLDTF, and negatively impact the amount of revenue collected for good causes.

“To ensure that one is not conducting an illegal lottery, one must verify such schemes with the National Lotteries Commission prior to making arrangements to conduct any competition or scheme. This judgement affirms the regulatory mandate of the NLC to build a regulatory environment for safe and sustainable lotteries where the interests of participants are protected,” the National Lotteries Commission said in a statement.

Below is the section which deemed it illegal: 

Section 57 (1): Any person who — (a) participates in; or (b) conducts, facilitates, promotes or derives any benefit from a lottery, promotional competition or sports pool, shall, unless such lottery, promotional competition or sports pool is or has been authorised by or under this Act or any other law, be guilty of an offence.

And Section 57 (2)(g): Any person who conducts, organises, promotes, devises or manages any scheme, plan, competition, arrangement, system, game or device which directly or indirectly provides for betting, wagering, gambling or any other game of risk on any outcome of any lottery unless authorised by or under this Act or any other law, shall be guilty of an offence.

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