Player protection measures contained in the South African government’s draft internet gambling regulations could prove too onerous to attract leading international operators to what will become Africa’s first regulated online gaming market, legal observers warn.

The long process of shaping new rules to regulate online gambling in South Africa is approaching its final stages, but fears that political turmoil in the country’s ruling ANC party may delay or derail the process are unfounded, according to a leading South African lawyer. But with taxes and fees still to be determined, operators may find themselves facing high costs and even higher regulatory hurdles.

With just five months to go until the 2010 Fifa World Cup, South Africa is reinforcing controls on casino gambling and sports betting. After nine years of legislative hurdles, it was thought that South Africa was close to completing a final version of the online gambling regulations but recent developments have raised doubts.

Legislation that will regulate online casino gambling in South Africa for the first time was finally approved in the country’s parliament earlier this week after several months of intensive debate. The bill has been passed to President Thabo Mbeki, but is not likely to be brought into effect until next year when additional regulations on licensing, tax and enforcement have been fully formulated.

The consultation process surrounding South Africa’s controversial National Gambling Amendment Bill has moved on to address the issue of advertising of online gambling services. Responses are believed to have ranged from acceptance to a proposal for an outright ban on all gambling ads in the country.

South African politicians, debating a new online casino bill, have been unable to agree on whether newly licensed internet casinos should be allowed to advertise their services, casting doubt over the bill’s future. Department of Trade and Industry officials warn it could now be the summer before the legislation is adopted and hint at a possible review of gambling advertising regulations in general to ease anti-gambling concerns within the country’s National Assembly.

Representatives of both the South African land-based casino industry and the online operator community have, so far, found little to like about South Africa’s draft online gambling proposals that have been debated this week in Cape Town but each has very different reasons for their objections.

With draft legislation now laid before the South African Parliament, a Department of Trade and Industry representative has indicated that the next stage of the political process should see many of prospective licensees’ key questions answered and a regime in place before the end of the year.

The concerns of provincial governments, combined with the Christmas break, have stalled the progress of South Africa’s internet gambling bill in the Upper House of the South African Parliament. Department of Trade and Industry officials nonetheless hope that the process will be reinvigorated over the coming months.

South Africa’s National Responsible Gambling Programme (NGRP) says that problems associated with online gambling are growing and measures to address them should figure strongly in the country’s upcoming online licensing codes.