Reg­u­la­tion bites

Finweek English Edition - - MARKETPLACE -

In its re­sults Niveus raised an is­sue with the draft Na­tional Gam­bling Amend­ment Bill, which states that bingo ma­chines must not “look and feel” like slot ma­chines, which the com­pany thinks may hurt its bingo busi­ness. Niveus is also com­plain­ing about the draft Liquor Amend­ment Bill, which it says could hin­der Vukani (its 100%-owned gam­ing as­set that spe­cialises in lim­ited-pay­out ma­chines out­side of casi­nos). Over­all, it claims that the govern­ment is try­ing to re­duce gam­bling out­side casi­nos, the area in which Niveus op­er­ates. In truth, it is hard to tell whether its claims against govern­ment have any truth to them or whether they are just at­tempts to get its way. But ei­ther way, gam­bling is a highly reg­u­lated in­dus­try that has pros and cons. Pros are bar­ri­ers to en­try for new­com­ers and even in­cum­bents ex­pand­ing. A con is govern­ment reg­u­la­tion, which will of­ten hurt growth and profit prospects. The bot­tom line is that this is an­other sec­tor I sim­ply avoid.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.