The South African national lottery operator, Ithuba Holdings, has been granted a 12-month contract expansion under what the Minister of Trade, Industry and Competition, Parks Tau, has described as an “emergency temporary license.” This decision, announced just hours before Ithuba’s previous licence expired on June 1, 2025, has sparked significant debate around its legality, transparency, and implications for the future of the national lottery.
What Is the Emergency Temporary License?
The Emergency Temporary License is a provision under Section 13B of the Lotteries Act, allowing the Minister to extend a lottery operator’s licence temporarily to ensure continuity in the lottery’s operations. In this case, the Minister utilised this provision to grant Ithuba an additional 12 months to operate South Africa’s national lottery, effectively extending Ithuba’s tenure beyond the legal limits set by the Lotteries Act.
Legal Framework and Controversy
South Africa’s Lotteries Act stipulates that a national lottery licence is valid for eight years, with a possible one-time extension of two years. Ithuba Holdings was initially awarded its licence in 2015 and received a two-year extension in 2023. The current 12-month contract expansion now raises questions about compliance with these legal provisions.
Legal experts have expressed concern that this extension could undermine the integrity of South Africa’s lottery tender processes. According to legal analysts, “Granting an extension beyond the statutory maximum sets a dangerous precedent and risks eroding public trust.”
Moreover, two court rulings have already found the tender process for the emergency temporary licence to be unfair and biased in favour of Ithuba. Despite this, the Minister proceeded with the contract extension, justifying the decision as necessary to maintain lottery operations uninterrupted during the search for a permanent licence holder.
Transparency and Public Concerns
Transparency remains a central issue in this saga. When approached for comment, Minister Tau’s spokesperson offered limited explanations, stating that the department was overwhelmed by media inquiries and would respond at a later stage. This perceived lack of openness has drawn criticism from opposition parties and civil society organisations alike.
Opposition figures have called for a full investigation into the circumstances surrounding the licence extension. They argue that public resources and trust are at stake and that adherence to fair tendering principles must be prioritised.
Financial and Operational Implications
Ithuba Holdings has publicly stated that operating under a temporary licence for a shorter period — initially proposed for five months — would not be financially viable. The company insisted that a longer extension was necessary to sustain operational stability and avoid disruptions to the national lottery.
The Minister’s decision to grant a 12-month extension appears to accommodate these financial concerns, but critics argue this flexibility favours corporate interests over the principles of competitive bidding and regulatory fairness.
Expert Opinions and Stakeholder Reactions
Legal and industry experts warn that the Minister’s use of the emergency temporary licence in this context stretches its original intent.
“While Section 13B exists to cover genuine emergencies or short-term gaps, extending an operator’s licence beyond the legal limits without a competitive process undermines regulatory integrity,” says a legal analyst.
Opposition parties have labelled the decision as questionable and potentially unlawful, demanding parliamentary oversight and an independent inquiry.
What Happens Next?
The national lottery remains an important source of revenue for social and development projects across South Africa. As such, the controversy around Ithuba’s licence extension is closely monitored by the public, industry stakeholders, and regulatory bodies.
The Minister has indicated that this 12-month licence is a temporary measure to allow for a thorough and fair tender process to identify a permanent operator. However, the process ahead must balance transparency, legality, and financial viability to restore confidence in South Africa’s national lottery system.
The Ithuba Granted a 12-Month Contract Expansion under an Emergency Temporary License highlights the challenges faced in balancing legal compliance, operational continuity, and public trust. While the Minister’s decision addresses the immediate need to keep the lottery running, the surrounding controversy underlines the necessity for clear, transparent, and legally sound processes in managing South Africa’s national lottery licences.
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