THE REPUBLIC OF UGANDA

Lotteries and Gaming Regulatory Board

PAPER ON THE STATUS OF THE GAMING INDUSTRY 2019

March 2019

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Table of Contents 1.0 BACKGROUND OF GAMING IN UGANDA ....................................................................... 3

2.0 LEGAL AND REGULATORY FRAMEWORK IN PLACE ................................................... 3

3.0 Gaming Operators since 2016 to date...................................................................................... 4

4.0 Licensing 2019............................................................................................................................. 4

4.1 Licensing Process: ...................................................................................................................... 4

4.1.2 Applicants seeking new licenses were vetted against the following criterion ........... 5

5.0 GAMING PREMISES .................................................................................................................. 6

5.1 Distribution of shops per region .............................................................................................. 6

5.2 Branches distribution in Kampala Metropolitan (Kampala, Mukono, Wakiso) ............... 7

6.0 BENEFITS OF THE GAMING INDUSTRY ............................................................................ 8

6.1 Taxation in the Gaming sector ................................................................................................. 8

6.2 Provision of employment .......................................................................................................... 9

6.3 Corporate Social Responsibility ............................................................................................. 10

6.4 Rental income and utilities ..................................................................................................... 10

6.5 Total stakes vs pay-outs .......................................................................................................... 10

7.0 INTERVENTIONS IN THE GAMING SECTOR ................................................................. 11

7.1 Local Content ............................................................................................................................... 11

7.1.1 Local content regulations ..................................................................................................... 11

7.2The National Central Monitoring System ............................................................................. 12

7.2.3 Registration of punters (players). ....................................................................................... 14

7.2.4 Cap the number of betting shops in Districts, Municipalities, Divisions, Town Councils countrywide. ................................................................................................................. 14

7.2.5 Amend the law ...................................................................................................................... 15

7.2.6 Amendment of Licensing fees ............................................................................................. 15

7.2.7 Illegal operators increasing the nuisance value ................................................................ 15

7.2.8 Audit of gaming equipment ................................................................................................ 16

7.2.9 Introduction of standards for equipment .......................................................................... 16

7.2.1.0 Introduction of testing and certification of equipment................................................. 17

7.3. ADVERTISEMENT AND SIGNAGE .................................................................................... 18

7.4 Responsible Gaming Program ............................................................................................... 18

8.0 POSSIBLE OUTCOMES OF THE INTERVENTIONS IF IMPLEMENTED IN AN ABRUPT MANNER .......................................................................................................................... 18

9.0 CHALLENGES ............................................................................................................................ 19

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9.1 The sector has gone electronic and borderless ..................................................................... 19

9.2 Underage gaming ..................................................................................................................... 19

10. WAY FORWARD ........................................................................................................................ 20

10.1 Lottery operations .................................................................................................................. 20

10.2 Areas of amendment ............................................................................................................. 20

11. CONCLUSION ............................................................................................................................ 21

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1.0 BACKGROUND OF GAMING IN UGANDA Gaming operations have been in existence in Uganda for over 50 years with lottery being the main gaming activity carried out in the 1960’s when the first gaming laws were drafted.

The gaming industry was regulated by the National Lotteries Board (NLB) and guided by the National Lotteries Act of 1967, the Gaming and Pool Betting (Control and Taxation) Act of 1968, and an addendum of statutory guidelines introduced in 2012/13. However, due to the expansion of the gaming industry, with new games being introduced over time, and in light of technological advancements, many facets of the law relating to lottery and gaming became out-dated.

Since the year 2000, the gaming industry in Uganda has experienced a rapid increase in activity, with various new modes and facilities being introduced. The growth of gaming has seen the industry diversify from the early forms of gaming like casino and lottery to new modes like sports betting, slot machines, bingo, pool betting, virtual games among other forms. This rapid increase is attributed to the following factors;

1. Increase in internet access 2. Increased cable television industry 3. Increase in telecom platforms 4. Advertisement and signage 5. Love for sports (both local and international) 6. Huge premise of hope offered by betting 7. Increased payment platforms

What is gaming?

In line with Section 2 of the Lotteries and Gaming Regulatory Act gaming means the playing of a game of chance for winnings in money or money’s worth.

There are 6 different forms of gaming in Uganda and these are;

i. Lottery ii. Casino

iii. Slot machines iv. General betting (Sports betting) v. Bingo

vi. Pool betting

2.0 LEGAL AND REGULATORY FRAMEWORK IN PLACE The Lotteries and Gaming Regulatory Board is governed and established by the Lotteries and Gaming Act 2016 and the Lotteries and Gaming Regulations 2017 (Fees, Licensing, Minimum Capital Requirements, Betting, Gaming and Betting Machines)

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3.0 Gaming Operators since 2016 to Date Before the law came in to place, the gaming industry had more than 100 operators countrywide but with the coming in force of the new regime the numbers have reduced as follows;

No Year Number of operators 1 2016 41 2 2017 44 3 2018 54 4 2019 49

4.0 Licensing 2019

4.1 Licensing Process: In line with Section 26 of the Lotteries and Gaming Act a person shall not establish or operate a casino or provide gaming or betting machine without a license. In operationalizing this Section, the Board invited applications for renewal and new licenses. Section 47 of the Lotteries and Gaming Act, 2016 provides that applications for renewal of licenses issued under the Act shall be submitted at least two months before expiry of the license. The Lotteries and Gaming Regulatory Board is in the process of licensing for 2019. The Board received a total of 60 applications and have so far licensed 49 (casino, sports betting and slot machine operators) and 11 pending licensing. Those that had not met the necessary requirements were given until the end of January 2019 to submit the missing requirements before they are licensed. We currently have the following operators;

Details of licensees 2019

No Type of gaming No of operators 1 Lottery 1 2 Casino 16 3 Sports Betting 32 4 Slot Machines 17 5 Bingo 3 6 Pool Betting 1

4.1.1 The existing applicants seeking renewal of license were vetted against the following criteria

1. Dully filled license Application forms and Application letter 2. Audited Accounts for the previous year 3. Proof of minimum capital requirement.(250 Million Shillings for Betting and

Slot Machines Operators and 1 Billion Shillings for Casinos )

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4. Current Income Tax Clearance by Uganda Revenue Authority 5. Annual return forms of a company with share capital 2018 6. Certificate of Good Conduct for all key foreign shareholder’s directors and

staff of the applicant 7. Interpol clearance for all key staff of the applicant 8. Work Permits for all foreign staff 9. An appropriate Corporate Social Responsibility program in accordance with

the Boards framework 10. List of gaming equipment in the boards approved format 11. Security guarantee in the boards approved format ( 500 Million Shillings) 12. Applicants shall indicate details of the branches being applied for in the

approved format. 13. Proof of citizenship of Shareholders and Directors 14. Commitment to register clients 15. Submission of network aggregators 16. Submission of details of franchisees.

4.1.2 Applicants seeking new licenses were vetted against the following criterion 1. Application fees 2. License application form and a cover letter 3. Proof of incorporation 4. Proof of minimum capital requirement.(250 Million Shillings for Betting and

Slot Machines Operators and 1 Billion Shillings for Casinos ) 5. Games and equipment that applicant intends to operate 6. Details of premises both the principle location and operational premises 7. Business plan 2019 8. Proof of tax registration 9. Details of company shareholders; police clearances/ proof of citizenship 10. Details of company directors; CVs/police clearances/ proof of citizenship and

work permit if foreign 11. Details of key employees; CVs/police clearances/ proof of citizenship and

work permit if foreign 12. Bank account details 13. Security guarantee in the boards approved format ( 500 Million Shillings) 14. Corporate Social Responsibility plan 2019. 15. Commitment to register clients 16. Submission of network aggregators 17. Submission of details of franchisees

Sports betting details

Sports betting is the most popular where most applicants express interest. It is however important to note that among the 32 the Board has so far licensed, only 22 operators run betting retail/physical outlets while 9 are online operators.

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Details of operators with sports betting premises/branches

No Name of operator Number of branches General Betting and Slot Machine Operators

1 Kings sports betting 298 2 Forte bet 298 3 Premier bet 92 4 Sports betting Africa 109 5 Best holdings 10 6 Bunga bet 27 7 Champion bet 123 8 Ultimate bet 27

General Sports Betting Operators 1 Fair sports betting 25 2 Paragon bet 5 3 WordStar sports betting 6 4 Goodbet 5 5 Gals sports betting 67 6 Sahara gaming 2 7 Top bet 168 8 Betin 18 9 Gal sports betting 67

Slot Machine Operators 1 Sastos amusements 28 2 Club win 16 3 Gemex Uganda 9 4 Big win slots 47 5 Arua casino limited 36

5.0 GAMING PREMISES A total of 1442 premises were approved and licensed by the Board 655 up country accounting for 45% and 787 in the Kampala Metropolitan Area (Kampala, Mukono and Wakiso Districts for 2019) accounting for 55%.

1 Upcountry 666 2 KMP 817 3 Total 1483

5.1 Distribution of shops per region No Region Number of shops %age 1 KMP 817 55.12821% 2 Central 65 4.385965% 3 South West 164 11.06613% 4 Albertine/Rwenzori 82 5.533063%

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5 Mid-East (Elgon, Teso) 72 4.8583% 6 Near East (Busoga) 130 8.77193% 7 Far East (Karamoja) 4 0.269906% 8 Northern 70 4.723347% 9 West Nile 79 5.263158% Total 1483 100%

5.2 Branches distribution in Kampala metropolitan (Kampala, Mukono, Wakiso) No Division No of branches 1 Kawempe division 150 2 Nakawa division 80 3 Makindye division 145 4 Kampala central division 142 5 Rubaga division 105 6 Mukono district 37 7 Wakiso district 158 Total No of branches 817

KMP55%

Central4%

South West11%

Albertine/Rwenzori6%

Mid-East (Elgon, Teso)

5%

Near East (Busoga)

9%

Far East (Karamoja)

0%

Northern5%

West Nile5%

Kawempedivision

Nakawadivision

Makindyedivision

Kampalacentraldivision

Rubagadivision

Mukonodistrict

Wakisodistrict

150

80

145 142

105

37

158

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6.0 BENEFITS OF THE GAMING INDUSTRY

6.1 Taxation in the Gaming sector Regarding gaming related tax revenues, the industry has grown at an unprecedented rate as shown in the table below. with tax collections growing from UGX 240 million in, UGX 11.1 billion in and 45 billion in. Below is a table for ease of reference.

Year shillings 2002/3 240 million 2013/14 11.1 billion 2017/18 45 billion

Currently a projection for the financial year 2019/20 is 50 billion.

6.1.1 Taxation regime

In accordance with Section 48(1) of the Lotteries and Gaming Act 2016 all gaming operators are meant to remit 20% of the total amount of money staked less pay outs for the period of filling returns. Section 118c of the Income Tax Act as amended 2018 a person who makes payment for winnings of betting or gaming shall withhold tax on gross amount of payment at the standard rate of 15%

Table showing 2018/19 projection and progressive year on revenues collected from the sector:

Year Billion shillings 2016/17 25 2017/18 35 2018/19 45 Projected for 2019/20 50

240,000,000

11,100,000,000

45,000,000,000

0

5,000,000,000

10,000,000,000

15,000,000,000

20,000,000,000

25,000,000,000

30,000,000,000

35,000,000,000

40,000,000,000

45,000,000,000

50,000,000,000

2002/3 2013/14 2017/18

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6.1.2 Expected revenue as per monthly returns (July 2018 to December 2018)

From the analysis of monthly returns submitted by licensees during the period July – December 2018 shs 46,929,167,599 was expected from the sector shs 13,822,530,237 was expected as gaming tax and shs 33,106,637,362 was expected as withholding tax.

6.2 Provision of employment The sector is employing 8959 people (professionals and non-professionals) in various capacities like:

1. Cashiers 2. Branch managers 3. Accountants 4. Marketing agents/sales agents 5. Security guards 6. Chefs for casinos 7. Cleaners 8. Administration

The following are details of employment in the sector.

Kampala metropolitan

Company Number of Employees

Kings sports betting 1100 Forte Bet 1282 Top Bet 806

Champion bet 298 SBA bet 312

Others including casinos and bingo 2200 Total 5998

Up country

Company Number of Employees

Kings sports betting 809 Forte Bet 585 Top Bet 351

Champion bet 175 SBA bet 170 Others including casinos and bingo 871 Total 2,961 Grand total 8959

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The age bracket of employees in this sector range from 18 to 25 years.

6.3 Corporate Social Responsibility Various gaming operators are sponsoring different football clubs worth billions of shillings. For example Betway online gaming company, sponsors express FC to a tune of shs 400 million shillings per year, Forte Bet sponsors SC Villa to tune 100 million and Top bet sponsors Mbarara FC to a tune of shs 200 million.

It is also a requirement that operators carryout Corporate Social Responsibility among the communities they operate in. At the end of last financial year a total of shs 800 million worth of social corporate responsibility programs was executed by operators countrywide ranging from medical support, school fees donations, and charity drives among others.

6.4 Rental income and utilities Betting operations are carried out in approximately 1442 branches countrywide. Kampala Metropolitan Area accounts for 787 and the rest of the country accounts for 655 betting shops. This has provided rental income for various landlords countrywide. It is also important to note that gaming operators invest heavily for the long term thereby giving stable income streams for the landlords. Contracts/ agreements range from 6 months to a year rental income under this sector is an average of shs 717,000,000/= per month and shs 8,652,000,000/= annually at an average rate of shs 500,000/=.

Additionally the sector supports other subsectors through payment of utilities like water, electricity, Cable TV (DSTV), internet providers and telecom companies thus creating a positive ripple effect to the economy.

6.5 Total stakes vs pay-outs That total amount of stakes the period July 2018 to December 2018 was shs 295,399,562,790 while the total pay-outs were shs 214,958,479,528 accounting for 73% of the total sales. It is therefore important to note that profit repatriation if any lies at

0

500

1000

1500

2000

2500

Kingssportsbetting

Forte Bet Top Bet Championbet

SBA bet Othersincludingcasinos

and bingo

11001282

806

298 312

2200

809585

351175 170

871

KMP UPCOUNTRY

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about 27% or less if operational overheads, tax and other costs are factored in basing on the monthly returns submitted to the Board by the operators. The profit levels to each operator is between 0%-10%

7.0 INTERVENTIONS IN THE GAMING SECTOR The Lotteries and Gaming Regulatory Board has developed several interventions in an effort to streamline the sector and remedy the following emerging issues;

1. Limited Ugandan involvement in the gaming sector 2. High nuisance value of premises 3. Rampant advertising and signage

7.1 LOCAL CONTENT What is a local company?

A local company is one which is incorporated and registered in Uganda or a company whose major shareholding is held by Ugandans and majority of its business is conducted in Uganda.

7.1.1 Local content regulations The Lotteries and Gaming Regulatory Board has in consultation with the Solicitor General drafted local content regulations to help increase Ugandan involvement in the industry. The Regulations have been sent back to the Solicitor General for final drafting and signature of the Minister of Finance Planning and Economic Development.

Regulation 8 of the draft local content Regulations provides that the Board shall give Ugandan or Ugandan company preference when considering an application for license and that where a license is issued under this condition it shall not be transferable to a non-Ugandan or a foreign company without Boards approval but after further scrutiny as to why it should be foreign.

The following are the current details of the Ugandan shareholding in the industry

Scale percentage Number of operators

%age

100% 14 32% 70%-100% 0 0 50%-70% 4 9% 30%-50 0 0 1%-30% 7 16% Fully foreign owned 19 43% Total 44 100%

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As reflected in the table above Ugandan involvement in the ownership of companies is at 57% with 32 % of the operators fully owned by Ugandans.

The following schedule shows the minimum local staff requirements as per draft regulations.

Item Upon initial licensing

Within three years Within 5 years

Recruitment and training

Management staff

30% 50-60% 70-90%

Technical core staff

50% 80% 90%

Other staff 100% 100% 100% Given the above schedule and timeframes the Regulations further emphasise capacity building of employees in the gaming industry through training and mentorship so that the technocrats that are imported for specific roles are taken over by Ugandans under the timeframes specified in the schedule above.

It is however important to note that currently 99% of the employees in the gaming sector are Ugandans.

7.2The National Central Monitoring System The Lotteries and Gaming Regulatory Board (LGRB) was established by the Lotteries & Gaming Act No 7 of 2016. The Board operations commenced in April 2016 under Ministry of Finance Planning and Economic Development. The Industry had however been in existence and the law enacted was to regulate the industry and define the new institutional framework in which the industry was to perform. In accordance with the Lotteries and Gaming Act No 7 of 2016, the Board is mandated to:-

100%, 14 70%-100%, 0

50%-70%, 4

30%-50, 0

1%-30%, 7

Fully foreign owned , 19

Total , 44

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a) Protect Citizens & Promote Transparency & Accountability b) Register and License Operators c) Approve Devices and Equipment for Gaming, Lotteries and Betting d) Collect Revenue from Gaming, Lotteries and Betting e) Promote Public Awareness & Information on the Industry. f) Regulate & Supervise Lotteries, Gaming, Betting and Casinos in Uganda

In delivering this mandate, it is imperative that the Board adopts ICT tools that can enhance the delivery of this mandate. The current operations evolve around a manual system of licencing, regulating and enforcing, and also to mention, the collection of revenues are based on self-declaration of the industry players. The industry is also faced with growing ingenuity and creativity in delivering their goods and services with online applications and interface devices to deliver new and more ingenious services in the sector; these are further detailed in the section for the justification of the CMS. The adoption of technology in enhancing the delivery of the mandate of the LGRB is envisaged therefore to deliver the following key business tenets:-

a) Automate Licencing: the CMS is envisaged to deliver electronic licence provisioning, revocation and control using the online tool. The CMS is envisaged to deliver to the industry a portal that for every period lists the licenced players as well as the archive of the expired licences or the revoked licences. The CMS will be able to enhance licencing by providing online tools to enhance licence to shorten the time-to-business of prospective players that meet the industry regulation. This portal shall be able to enhance the holistic registration process including Business Entity, Branches / Shops, Locations, Brands, Devices etc.

b) Billing & Revenue Collection: the CMS is envisaged to proactively and online, collect data from the industry players through online interfaces to enable LGRB get information on revenues by compliance not by declaration. The system must be able to generate performance statistics with an agile reporting interface that will be able to deliver information that is meaningful to Government and the industry for regulation and enforcement purposes. This module is envisaged to be pivotal in ensuring a vibrant industry and to deliver efficiency to the industry by providing efficient tax administration and monitoring.

c) Enhance Regulation and Responsible gaming: the CMS through integration

with the NIRA can provide statistics and data on the stakeholders in the gaming industry to regulate age, control crime and fraud and also enhance compliance with industry regulations.

d) Proactive Enforcement: the CMS system is envisaged to provide our enforcement and regulation team with reliable data that shall inform them on matters of enforcement with particular regard to due diligence data, licence status information, illegal services. This module shall enable the industry to

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be more responsive to regulation and thus ease compliance with an effect on increased revenue and responsiveness.

e) Standardised Industry: with the CMS, the Board will be able to give guidance on Standards for devices that can interface with the CMS. In so doing, the CMS will enable the industry to procure equipment that is compliant with regulations and in so doing streamline the industry. The CMS will thus enable definition of equipment standards on the web portal for devices that integrate with the CMS for purposes of integration. The CMS mobile and online interface will enable logging of mobile money transactions and Credit/Debit Card interfaces that will enable adoption to technology.

f) Service Differentiation: the ability of the Board to use ICT tools to deliver their mandate will improve efficiency, improve revenues, regulate compliance and ensure a vibrant industry and as a result positioning the Board favourably in terms of performance.

g) Device Management, The target object for the CMS are the devices used to operationalize gaming and Lottery. It’s important to track and locate devices and have an up to date assessment of their operational status

7.2.3 Registration of punters (players). Furthermore, the Board has also made it mandatory for all operators to register all punters accessing their premises or online platforms. The following are the details required;

1. Name of punter 2. National identification number 3. Registered telephone number 4. Nationality 5. Passport number for foreigners and refugee cards for refugees

The Board is also in process developing regulations for identifications and registration of all punters. The objective of this is to;

1. Protect minors 2. Ensure identification of problem gamblers 3. To ensure accountability and facilitation of taxation of operators

7.2.4 Cap the number of betting shops in Districts, Municipalities and Divisions countrywide. The Board is in the process of reviewing the policy on capping the number of branches in each of the Districts, Divisions and Municipalities and Town Councils. Areas considered are gazetting and allowing a specific number of premises per District. Currently the board has approved and licensed a total of 1442 countrywide.

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7.2.5 Amend the law Increase the size of premises

The Board proposes to increase the size of premises from 30 SQM to 40 SQM aimed at putting in place a stringent branch size requirement in order to reduce the number of branches and improve quality and ambiance and security of gaming premise.

Change the licensing process

The Board intends to institute an auction based format of licensing aimed at

1. Creating positive competition and improve equality in branch license applicants

2. Promote and enhance compliance to sector rules and regulations by licensees to maintain their licensees and avoid revocation with limited opportunities for renewal

3. Creating no gaming zones with the objective of eliminating gaming in unsuitable areas as well as regulation the proliferation of gambling across the country

7.2.6 Amendment of Licensing fees The Board intends to increase licensing fees from 1 million to 5 million shillings per branch in order to counter the rapid proliferation of gaming outlets.

7.2.7 Illegal operators increasing the nuisance value Although the Board has significantly reduced the illegalities in the industry we continue to have illegal operators in the sector these mainly include; Home Bet (50 premises) Game Bet (16 premises) across the country.

The illegalities also include slot machine operators for example Lee and Gao estimated to operate 2002 machines,MCGI-95 machines and E-Star estimated to operate 1903 machines. The total number of illegal machines in circulation are therefore estimated to be about 4000 as at 31st Dec 2018.Such illegalities are also likely to promote other illegal/criminal vices like Money Laundering and Terrorism financing.

In order to remedy the above, the Board has carried out a country wide exercise of registering all licensed slot machines on the National Register. This is to help track and identify specific machines to specific localities and also avoid unmonitored transfer of machine from one location to another.

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The Board passed enforcement guidelines to better regulate the industry and enforce compliance of gaming operators. Details are as follows;

Number of registered gaming machines countrywide

Region Number

KMP 2,911

Up country 1,105

Total 4,016

The Board is creating strategic partnership with Uganda Revenue Authority, local Governments and Ministry of Trade to better manage the sector and enforcement of illegalities. The Board has currently signed MOUs with Mbale, Jinja District, Entebbe Municipality, Mukono Municipality and Mbarara (to be signed this week).

In order to counter/remedy the threat posed by the possibility of the sector harboring Money laundering and terrorism financing activities the board has:

Signed and operational and information sharing MOU with the Financial Intelligence Authority.

Appointed a standing Anti-Money Laundering and Terrorism Financing sector liaison team to support the FIA.

Implemented FIA directives for all casinos to appoint Anti Money Laundering control officers.

Developed a sector based Anti-Money Laundering policy guideline for all Casino operators to adopt.

Trained Casino AML control officers Followed up to ensure all Casinos are registered with the FIA as per 2013

AML ACT.

7.2.8 Audit of gaming equipment The lotteries and gaming board is currently conducting a countrywide audit of gaming equipment to ensure that only registered equipment are used in the market. Any equipment not registered, standardized or approved by the board shall be confiscated and destroyed accordingly.

7.2.9 Introduction of standards for equipment The Uganda National Bureau of Standards with support from the National Gaming Board has come up with standards for gaming machines and software these are;

1. Gaming Equipment-Limited Payout- Requirements (US1580-2:2017) 2. Gaming Equipment-Casino-Requirements (US 1580-1:2017)

The following standards are currently being reviewed by the standards committee

1. Wagering record keeping software

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2. Monitoring control systems 3. Tokenization 4. Local area and wide area jackpot 5. Information and operation security

7.2.1.0 Introduction of testing and certification of equipment Sections 36, 37 and 38 of the Lotteries and Gaming Act, 2016 provides that the Board may establish a National Register of gaming and betting machines and devices, determine and set standards in respect of the manufacture, supply, installation, adaptation, maintenance or repair of gaming or betting machines and software.

As required under section 37(3) of the Lotteries and Gaming Act a testing lab (BMM) was prequalified to carryout testing of all machines in Uganda against the approved gaming standards mentioned above. This process is aimed at protecting the citizens of Uganda from the substandard machines in the industry. Section 37(3) provides the Board may

1. Make arrangements with any person for the purpose of testing gaming or betting machines to ensure compliance with the required standards

2. Require the holder of a gaming or betting machine technical operating license to submit to a test and to produce specific evidence of the result of the test.

3. For the purpose of considering whether to grant an application for a gaming or betting machine operators license require the holder or an applicant for a gaming or betting machine technical operating license to submit a machine to a test in accordance with this section.

Regulation 7 of the Lotteries and Gaming (Gaming and Betting Machines) Regulations, S. I. No. 10 of 2017 provides that the Board may utilize the services of an independent testing laboratory approved by the Board for inspection and certification of any gaming or betting machine or device.

Objectives of testing and certifying gaming devices

1. Protect the players involved in gaming 2. Direct exclusion of unlicensed and illegal gaming devices from the market 3. Enhance Legally conducted gaming

Gaming operators with machines that don’t meet the standard have been advised to phase them out. Additionally the Board is in the process of pre-qualifying two more testing labs in order to expedite the country wide testing exercise.

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7.3. ADVERTISEMENT AND SIGNAGE The Board is in process of issuing a directive to review all gaming advertisements both in print media, radio shop branding and signage. This is aimed at reducing the nuisance value in the industry and reduce the negative effects of gaming in the industry. The Board recommends all signage to be standardised to 1mx0.5m

Additionally The Board is reviewing the policy allowing companies to carry out promotional competitions which are mainly carried out by communication companies like MTN and Airtel and other companies like Plascon, Roofings, and Total among others. They portray winning as a probable outcome although they are disguised as marketing tools. Other companies include Roofing Uganda and royal paint.

7.4 RESPONSIBLE GAMING PROGRAM What is responsible gaming?

Responsible gaming entails the protection of the public from adverse effects of gaming and betting including promotion of transparency and accountability. Under responsible gaming the protection of the vulnerable groups (underage and addicted punters) is very important and promotion of ethical and responsible marketing.

The Board in line with Section 4(J) of the act is in the process of developing its responsible gaming programme to better regulate the sector this program will include projects and activities like

1. Counselling of the gaming addicts 2. Training in financial growth by institutions like Capital Markets Authority

Investment Clubs SACCOS and Bank of Uganda 3. Involvement of operators on how to ensure responsible gaming in their

premises among others 4. Sensitisation

In order to achieve this the Board plans to partner with different NGOS health facilities and financial institutions to enable its smooth implementation once approved by the Board this program will be monitored for better outcomes

8.0 POSSIBLE OUTCOMES OF THE INTERVENTIONS IF IMPLEMENTED IN AN ABRUPT MANNER

a) There shall be a reduction in government revenue b) Increase in unemployment which may breed other vices c) Reduction of incomes from rental income and other utilities. d) Punters may opt to play on international platforms e) Legal action by operators who have already applied in 2019 and not yet

licensed the deadline is January 2019.

As the interventions are carried out, there has to be a deliberate balance. The Board therefore recommends that implementation of the changes takes a period of two years to minimise disruption.

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9.0 CHALLENGES

9.1 The sector has gone electronic and borderless Gaming operations worldwide have gone online and borderless that is to say punters place bets on computers, telephones. It shall therefore be a challenge to combat illegality in the sector. Technologies like VPN have been a source of dodging regulations worldwide. Among the current operators in Uganda 65 % have an online platform. This shall be remedied by the implementation of the central monitoring system as mentioned above.

To further address this challenge the Board has passed online regulations that shall help in streamlining online gaming. These regulations are aimed at achieving the following;

Better Control over Problem gaming through registration of punters Protect players, players will have unlimited access to their transactions on the

betting sites Online regulations will support proper Accounting procedures Online regulations will promote fairness of games, this relates to sites which

offer casino games, poker, or any other interactive gaming activities. All games should demonstrate that customers have an equal chance of winning. This refers to ensuring all software is fully tested on a regular basis.

Regulation will guide in Handling complaints

9.2 Underage gaming Section 1 of the Lotteries and Gaming Act 2016 defines a minor to mean a person below 25 years. In spite of the reduction in cases of underage gaming recorded since the inception of the Lotteries and Gaming Regulatory Board and commencement of its field enforcement activities underage gaming has persisted in some of the gaming houses. As a remedy to this, In accordance with Section 61 of The Lotteries and Gaming Act, the Board is in process of procuring a National Electronic Monitoring System for the purpose of:

a) Detecting and monitoring significant events associated with a casino, gaming and betting machine or gaming and betting activity licensed under this Act.

b) Analysing and reporting received data in accordance with the prescribed requirements. The Act further mandates the Board to:

c) Contract with any person to supply any or all of the products or services required to fulfil its obligations under this section.

d) Have every gaming and betting machine that is made available for play be electronically linked to the National Central Electronic Monitoring System.

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10. WAY FORWARD

10.1 Lottery operations The Board has commenced the processes of acquiring a new national lottery operator in Uganda a call of ideas has been sent out to various jurisdictions in order to better regulate the national lottery.

10.2 Areas of amendment The following are the areas of amendment that shall help in better streamlining/ management of the sector

1. Advertisement and signage regulations ;

The Board is reviewing and plans to put in place to manage the advertisement of gaming in Uganda the objective of these are;

To control appeal and access of gaming by un qualifying and unsolicited persons.

To manage appeal of underage persons To control the nuisance of unnecessary advertisement

2. Lottery / National Lottery / Public Lottery / Promotional Competition Regulations.

The Board is in process of streamlining, defining and putting in place guidelines to manage the licensing and approval of the above mentioned activities this will guide the continued approval and licensing of lottery and promotional competitions in Uganda.

3. Gaming rules/ guideline regulations

The Board is in process of setting up standard gaming rules and guidelines for all games in the sector. This will harmonise the different rules that operators currently have. Below are some of the areas that shall be looked at among others are;

Minimum stake and Reporting of unclaimed winnings Problem Tickets Time of placing bets Reporting unsettled payments Errors

4. Streamline business to business services

The Board is in process of putting in place regulations for licensing and control of business to business transactions in the gaming industry. This will include control and licensing of gaming intermediaries and agents. The objective of this initiative is to ensure accountability, effective taxation and eliminate illegal gamin g operators.

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5. Implementation of the central monitoring system

As mentioned above the board is in advanced staged in procuring a national central monitoring system. This shall help in the implementation of most of the interventions mentioned above.

11. CONCLUSION Therefore with the planned interventions in the pre-licensing requirements, processes/procedures and enforcement actions as highlighted above the Board should be in position to:

1. Ensure increased Ugandan participation in the sector through ownership, senior management positions and general employment.

2. Visible reduction in the nuisance effect created by the sector being oversubscribed through numerous operational branches and gaming centres.

3. A substantial increase in gaming revenue as a result of streamlining the monitoring of gaming activities through the introduction of the central monitoring system.

4. Reduced visibility of the gaming industry to the public through the reduction of gaming premises and streamlining gaming advertisements.

5. Introduction of the central monitoring system 6. Increased compliance and enforcement initiatives 7. Implementation of responsible gaming campaign. 8. The Board has issued operational guidelines every licensing year. Find

details of 2019 operational guidelines on www.ngb.go.ug