In 2022, Kenya enacted the Gambling Control Act, leading to the creation of the Gambling Regulatory Authority (GRA) and the implementation of substantial new regulations governing the gambling industry. This act replaced legislation that had been in place since 1966 and shifted oversight authority from the Betting Control and Licensing Board to the newly formed GRA.
The initial licensing cycle under this renewed regulatory framework began recently, following the introduction of five subsidiary regulations that came into effect on July 1. Among the regulations is a requirement for the review of license applications within a period of 14 days, with a final decision from the board due within 30 days. Licensees have 14 days to file an appeal if their application is rejected.
John Mutua, CEO of the Association of Gaming Operators Kenya (AGOK), described the scope of the Gambling Control Act as significantly beneficial, emphasizing a much-needed structural overhaul for the industry after ongoing regulatory challenges. He remarked, "What we are seeing is a fundamental shift in how operators will do business in Kenya. Those who comply will survive long term, and those who choose to operate outside the compliance scope will find it increasingly difficult to sustain their business."
For years, the Kenyan gambling industry was dictated by inconsistent ministerial directives and faced regulatory hurdles due to inadequate resources at the Betting Control and Licensing Board.
Echoing Mutua's sentiments, Peter Kesitilwe, CEO of the African iGaming Alliance, noted that Kenya is moving towards a much more stable regulatory environment, which it has lacked historically. He pointed out that this new framework is more comprehensive and aligned than prior regulations, highlighting the introduction of structured oversight mechanisms, appeals processes, and enhanced responsible gambling obligations.
Under the new regulations, strict guidelines now govern advertisements, requiring GRA approval and classification by the Kenya Film Classification Board. Advertisements must also allocate 20% of their space to responsible gambling warnings, and celebrity endorsements are prohibited. Furthermore, ads cannot be aired on TV or radio from 6 AM to 10 PM, except during live sports broadcasts.
The Gambling Control Act also mandates that licensees maintain a corporate structure in which a minimum of 30% of shares must be owned by Kenyan citizens. Mutua sees this as indicative of a significant focus on the accountability of businesses within the licensed gambling sector. He commented that this regulation seeks to ensure tax obligations are met by Kenyan stakeholders, creating a level of scrutiny that eliminates opaque operations.
Taxation has been a contentious issue in Kenya's gambling landscape, with rates undergoing numerous changes. However, the government established a more stable tax regime last July, imposing a 5% tax on all withdrawals from betting wallets, replacing a previous 20% tax on net winnings. Additionally, a new 5% excise duty on deposits has taken the place of a 15% rate.
Mutua described this new tax structure as "well-designed," asserting that it is clear, verifiable, and straightforward to implement—a setup beneficial for both operators and regulatory bodies. He noted that since the implementation of these changes, tax collection has surged by 29%, providing a win-win for both the government and the operator clientele. This improved framework allows operators to plan and invest while providing stable revenue for the government and greater confidence for players.
This newfound tax certainty is drawing the interest of international investors. Super Group CFO Alinda van Wyk indicated that the reforms have revived Kenya's attractiveness for expansion. She explained that previous tax complexities left legal operators in a difficult position, often leading to a growth in illegal operations. With the changes now in place, she believes that the country is on a path to stability that could warrant renewed investment considerations, stating, "Now that Kenya has changed its tax laws, it gives us the ability to say, ‘Okay, now things are stabilized, we see a path to profitability and we will try Kenya again.’"
