2 April 2007
On 31 July 2006 I announced Gidani as the preferred bidder for operating the
National Lottery and Uthingo, the current operator, as the second preferred
bidder. Following this announcement we had concluded a licence agreement with
Gidani.
The reason that a second preferred bidder was identified was to ensure that
I would be in the best possible position to ensure the continuation of the
National Lottery in that in the event that negotiations had not been
successfully concluded with Gidani, I would have the option of considering
Uthingo as the operator.
On 4 October 2006 I proceeded to announce Gidani as the successful bidder to
operate the National Lottery for the period commencing 1 April 2007.
I had made the decision within a time period which would allow for a
continuation of the National Lottery. I understand the interest of the public
at large in the Lottery and more importantly that the Lottery is conducted for
the benefit of various good cause organisations.
On 15 November 2006 Uthingo launched an application to the High Court of
South Africa challenging my decision to award the licence to Gidani.
On 5 March 2007 the High Court upheld certain procedural objections raised
by Uthingo in regard to the process followed. In particular, the High Court
pronounced both the nature and the extent of the statutory investigations which
in its view must be made before a licence is awarded. The Court has held that
in certain respects the investigations previously undertaken were
incomplete.
On receipt of that judgment I called for further investigative work to be
undertaken by the National Lotteries Board in line with the Court's
requirements. The sheer volume of work that has had to be undertaken, which
includes extensive probity checks that need to be conducted both nationally and
internationally , made it impossible to conclude this work in time for me to
make a new decision before the expiry of the current licence.
The current licence will expire at midnight and there is no legal basis to
extend it in the present circumstances.
As a result and for a limited period of time there will be no licensed
operator authorised to conduct the National Lottery; a situation that I deeply
regret. I am however pleased to say that in the interest of the public I have
been in consultation with all of the bidders, with whose support, we are
exploring options in the law to minimise the period in which there will be no
lottery.
I am also pleased to say that the contributions made via Lottery funding to
deserving causes will continue because there are adequate reserves available
for the next twelve months.
I will announce the appointment of a National Lottery operator within a
short period which I expect to be about one month.
I know how popular the Lottery has become. I hope that all players will
continue to support the Lottery as enthusiastically as they have done in the
past. I believe that in terms of the current licence conditions those who win
prizes during the course of March should be paid without any delay, and as I
have said, the payment of funds to good causes will not be interrupted.
Issued by: Department of Trade and Industry
2 April 2007
Source: Department of Trade and Industry (http://www.thedti.gov.za)
