South African Court Forces Minister to Name New Lottery Operator by May 28
A court in South Africa has ordered Trade, Industry and Competition Minister Parks Tau to announce the next National Lottery operator by 28 May 2025. The ruling follows a legal challenge from a rival bidder and puts an end to a controversial delay that had left the future of the country’s lottery in limbo.
Legal Pressure Forces Decision
The challenge was brought by Wina Njalo, one of the companies vying for the eight-year lottery licence. The current operator, Ithuba Holdings, is set to see its tenure expire on 31 May. In response to delays, Minister Tau had proposed a stopgap solution: a one-year temporary licence, which critics argued would inevitably go to an entity closely tied to Ithuba.
Wina Njalo successfully argued that the plan unfairly favoured the incumbent, particularly because only Ithuba had the necessary infrastructure in place to run the lottery without disruption. “A tender process cannot have an inevitable outcome or be foreseeable,” said Judge Sulet Potterill. “This is crucial for ensuring fairness, transparency and adherence to procurement laws.”
Minister’s Reasoning Deemed Inadequate
In court filings, Minister Tau described the licensing process as “extremely complex,” pointing to past corruption scandals involving the National Lotteries Commission as justification for a cautious approach. However, Judge Potterill found his explanation insufficient and constitutionally flawed.
“He simply has not [provided reasons],” she wrote, criticizing the minister’s failure to explain the delay beyond vague references to unspecified concerns. The court declared the delay invalid and instructed Tau to announce the new operator by 28 May, unless he appeals the ruling.
Temporary Licence Under Scrutiny
The court also reviewed the temporary licence arrangement, which Tau had planned to offer while the main licence decision was pending. Documents revealed that Ithuba Lottery—an entity with seven shared directors with Ithuba Holdings—intended to assume operations by acquiring Ithuba’s assets and technology.
Though the judge acknowledged that an interruption to the national lottery could jeopardize funding for charitable causes, she emphasized that this did not justify bypassing due process.
She ruled that the proposed temporary licence was invalid but suspended the ruling for five months to ensure continuity of operations. “I am unconvinced that a period of 12 months is necessary,” she added, effectively limiting the extension.
Financial and Political Fallout
The ruling comes with cost implications: the minister, the National Lotteries Commission, and Ithuba Lottery have all been ordered to pay Wina Njalo’s legal fees. It’s a development that not only resets the National Lottery’s timeline but also underscores the importance of transparent procurement in state-controlled industries.
For now, all eyes turn to 28 May—the court-imposed deadline by which South Africa’s next lottery operator must be officially named.
===================
National Lotteries Commission to appeal lottery judgment
Chair Barney Pityana says it will be impossible to implement the judge's order
The board of the National Lotteries Commission (NLC) has resolved to appeal the judgment which ordered trade, industry and competition minister Parks Tau to determine the successful applicant for the fourth national lottery licence by no later than May 28.
The judgment, passed by the Pretoria High Court on Wednesday, also ordered the minister to negotiate a licence agreement with the successful fourth licensee by no later than May 28. It declared as unlawful and invalid the minister's decision to extend the bid validity period for the fourth national lottery licence by an additional 12 months, until May 31 2026.
The court also declared the minister's issuance of the request for proposal (RFP) to operate a temporary national lottery licence (from June 1) as unconstitutional and set it aside. However, judge Sulet Potterill suspended this order for five months for the fourth licensee to take over the operation of the national lottery.
She said it was a just and equitable remedy to set aside the temporary licence RFP, but to suspend that order for five months to enable the continuation of the national lottery.
“I am unconvinced that the period of 12 months argued for is necessary,” Potterill said.
Speaking to Newzroom Afrika on Thursday, NLC chair Barney Pityana said it was appealing the judgment and was contesting the five-month period for the new licensee to take over the lottery, as ordered by the judge.
“We are contesting that. We think the judge probably misunderstood the scope of what it takes to set up a process from the beginning. Strictly speaking, if we go along with what the judge says, everything that has been done is simply going to fall away.
“The good news is that the minister expects to be able finalise the licence for the operation of the lottery by May 28.”
Pityana said the NLC was appealing the judgment in the way it was formulated.
“It makes it impossible to do even what the judge herself felt was in the public interest to do.”
Pityana said it was impossible for a new operator to take over the operation of the national lottery in five months. At the very least it could be done in 12 months, he said.
“The board has resolved to appeal the judgment because the way it is, it is an impossible judgment to execute even that which the judge sought to help us to do.”
https://www.timeslive.co.za/news/south-africa/2025-05-22-national-lotteries-commission-to-appeal-lottery-judgment/