SportPesa Gears Up for Legal Battle with Kenyan Government

Sports betting platform SportPesa has geared up for a protracted legal battle with the Kenyan government. The operator told that the government was deliberately politicising a dispute over tax to interfere with its Kenyan operations. This has left SportPesa unable to process mobile payments, prompting it to cancel all sports sponsorship agreements in the country.

On 1 July, Kenya’s gambling regulator (BCLB), declined to renew the licence applications of SportPesa and 26 other companies. The BCLB claimed it was owed a total of KES60.56bn in unpaid taxes, claiming that Kenya’s Gaming Bill states that the country’s 20% tax on winnings applies to both profit and to the bettor’s original stake.

“SportPesa is fully tax compliant in all of the markets in which we operate. We have been recognised by the KRA as such, receiving tax compliance awards in 2016, 2017 and 2018,” a SportPesa spokesman said.

The SportPesa spokesman said that the company secured a High Court order that overruled the regulator and prevented the authorities from suspending payment services and interfering with the company. However, on 10 July, the state ordered the telecoms company Safaricom to block banking services to the 27 companies. On 22 July, SportPesa opted to take legal action against the regulator to overturn the blocking order. The High Court is currently considering whether the authorities acted illegally in blocking access to customers’ accounts.

On 9 August, Sportpesa announced it was suspending all of its sports sponsorships in the country. On 11 August, SportPesa was also named in a Sunday Times investigation into the advertising of betting to children in Kenya. However, a SportPesa spokesman denied the operator was deliberately targeting minors.

“SportPesa takes its commitment to ensuring responsible gaming in Kenya extremely seriously. We do not advertise to children and are compliant with all advertising regulation in every market we operate in,” the spokesman said.