National Lottery Licence
By Thabo Mosia
Wina Njalo, a bidder for South Africa’s national lottery licence, has accused Minister of Trade, Industry and Competition Parks Tau of failing to commit to a firm date for awarding the new licence, sparking a legal battle set to unfold in the Pretoria High Court. The company, an initiative of the HCI Foundation, claims Tau’s delays threaten the future of the national lottery and unfairly favour the current operator, Ithuba.
Court Action to Force a Decision
Wina Njalo has launched an urgent court application to compel Tau to award the fourth national lottery licence before the current licence, held by Ithuba, expires on 31 May 2025. The company argues that Tau’s “target date” of 28 May for announcing the new bidder is not binding and lacks credibility. CEO Dawid Benjamin Muller, in an affidavit filed this week, stated that the minister should have agreed to a court order to “unequivocally reflect his stated commitment” to finalising the process by 31 May.
“However, the minister was not prepared to commit to this in a court order. This can only mean that his target date is not a genuine date by which the minister is prepared to make the decision,” Muller said, accusing Tau of misleading bidders.
Wina Njalo seeks a court order directing Tau to announce the successful bidder by 9 May and conclude the licence agreement by 31 May. The company also wants the court to set aside a request for proposals for a 12-month “temporary licence,” which it calls “unconstitutional and unlawful.”
The case is scheduled for an urgent hearing on 22 April, with Tau and the National Lotteries Commission (NLC) required to file opposing affidavits by 14 April.
Allegations of Favouritism and Delay
At the heart of Wina Njalo’s grievance is the claim that Tau is frustrating the process to “advance the interests of the present licence holder,” Ithuba. Muller argues that the minister’s decision to extend the bid evaluation process by a year and issue a “temporary licence” proposal benefits Ithuba, as only the current operator has the infrastructure to run the lottery immediately. Other bidders, he says, would not invest in costly systems for a licence lasting just 12 months.
“The lengthy, ongoing delay is important and telling. It is a significant period of time (almost four months). In the absence of an explanation from the minister, which has not been given, as to what he has been doing in that time, the inference becomes inevitable that the minister had wantonly delayed taking the licence decision and thus caused the delay which has eventuated to ensure that Ithuba’s extension became a foregone conclusion,” Muller said.
Muller further alleges that the temporary licence is essentially an unlawful extension of Ithuba’s current contract. He claims the invitation for other bidders to apply was designed to “soften their attitudes” and deter legal challenges, rather than foster a fair process.
Threat to the National Lottery’s Future
The national lottery is a vital source of funding for South African charities, sports, and arts organisations, generating billions of rands annually. Wina Njalo warns that Tau’s “irrational and unlawful” decisions threaten its very existence. Without a new operator in place by 1 June, lottery ticket sales could be suspended, disrupting grants to non-profits and community projects.
The company says Tau has failed to provide proper reasons for not awarding the fourth licence, despite repeated requests. Seven months ago, the NLC board promised a revised timetable for the tender, but no updates have been shared. Muller also pointed out gaps in the minister’s documentation, including missing evaluation and adjudication reports, an independent audit of bidders, and records of consultations with the NLC and National Treasury.
“There was also ‘not a single document’ regarding the minister’s consultation with the National Treasury, to which he had referred in a media statement in December 2024,” Muller noted, calling the minister’s actions unlawful.
A History of Extensions
Ithuba has operated the national lottery since 2015, when it was awarded an eight-year licence valued at R60 billion to R65 billion. In 2023, then-Minister Ebrahim Patel extended Ithuba’s contract by 24 months, citing the impact of COVID-19 on its earnings. Under the Lotteries Act, a licence can only be extended once for a non-renewable period of 24 months, making further extensions legally questionable.
Tau’s initial plan for a temporary licence was seen as a workaround to this restriction, but it drew criticism for favouring Ithuba. In late March, following Wina Njalo’s court application, Tau backtracked, announcing he would name the permanent operator by 28 May instead. However, Wina Njalo argues this commitment is too vague and does not resolve their concerns.
Minister’s Defence and Contingency Plans
Tau’s legal team has argued that an extension of Ithuba’s licence or a temporary licence may still be necessary “if the process for the awarding of the fourth licence cannot be concluded, for whatever reason, by 31 May 2025.” They say the minister aims to “avoid a situation where there is no lottery in place,” which could harm charities and players.
The NLC has reassured stakeholders that it has contingency measures, including reserves of over R4 billion, to continue funding good causes if ticket sales are halted. However, a suspension would still disrupt the lottery’s operations and public trust, experts
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