Betway facing £110,000 fine for regulatory failure in Kenya

Betway are facing a fine of Sh15m (£110,000) after Kenya’s competition watchdog has accused the operator of not informing it of changes in ownership of its partner, Bluejay Limited, in 2015.

Kenyan flag

The fine relates to Betway’s Kenyan partner, Bluejay Limited. © Wikipedia.

The Competition Authority of Kenya (CAK) has detailed its case in a report, accusing Betway of selling a stake in Bluejay Limited to GM-Gaming in 2015 without informing the regulator. GM-Gaming then issued its controlling shares to a third company, Rosehall Global, without the watchdog’s approval.

The regulator claims that this falls foul of the Competition Act, which states that the sale of shares or assets that result in a change in control of ownership must be approved by the Competition Authority.

In Kenya, mergers between two firms with a combined turnover of more than Sh1bn must be investigated and approved by the Competition Authority of Kenya, to ensure there is no negative impact on competition and public interests.

Alongside issuing a fine, the CAK can also issue a prison term up to five years. An administrative penalty of up to 10% of the previous year’s turnover can also be issued.

A statement released by the Competition Authority read:

The authority, using its own intelligence, initiated investigations into the conduct of Bluejay (Betway) pursuant to Section 42(2) of the Act that prohibits implementing mergers without prior approval of the authority. It was established that Bluejay were in contravention of Section 42(2) and (3) of the Act by implementing two transactions without prior approval. Statement, The Competition Authority Kenya

Betway is also under investigation in Belgium by the regulator there, the Kansspelcommissie. The regulator has launched sanctions against Betway due to transparency failings in its corporate ownership structures. Betway was also found to have breached certain licensing conditions.

Those findings were the result of a year long investigation by the Kansspelcommissie. The regulator is currently deliberating over whether to issue legal charges, whilst Betway has the opportunity to reply to the charges. The operator faces a fine of up to six-figures and could also lose its Belgian licence.

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