The South African Bookmakers’ Association (SABA) has issued a formal policy position paper urging national regulators to ban unlicensed prediction market platforms or bring them under the country’s existing gambling law framework. SABA contends that global event contract exchanges like Polymarket operate as functional equivalents to peer-to-peer (P2P) betting exchanges, facilitating wagers on political, economic, and sporting outcomes without local licensing, taxation, or consumer protection mechanisms.
Key Recommendations in SABA’s Policy Position Paper
The trade body outlined five core principles for South African policymakers evaluating event derivative platforms:
- Functional Equivalence: Classifying prediction markets as exchange-style betting products subject to standard gambling regulation rather than financial forecasting tools.
- Prevention of Regulatory Arbitrage: Closing legal loopholes that allow offshore operators to offer wagering services to South African citizens without local licensing.
- Dedicated Legislative Review: Establishing a unified review across gambling, financial market, and anti-money laundering (AML) legislation before authorising peer-to-peer contracts.
- Precautionary Approach: Treating unlicensed prediction platforms as part of the illegal offshore gambling market until dedicated statutory frameworks exist.
- Integrity Safeguards: Mandating strict surveillance mechanisms to protect political governance, municipal appointments, and sports competitions from market manipulation.
Political Governance and Market Manipulation Concerns
A key trigger for SABA’s policy paper was a recent report revealing that over R700,000 (€38,000) was wagered via Polymarket on the selection of Johannesburg’s next mayor. SABA warned that enabling retail speculation on municipal leadership positions, legislative votes, and cabinet appointments introduces severe risks of insider trading and political corruption.
Unlike traditional sportsbooks where bookmakers assume financial risk, P2P prediction markets match opposing bets between participants and collect transaction fees. According to SABA, allowing participants to profit from negative or losing outcomes creates direct financial incentives to influence civic outcomes, creating an acute regulatory blind spot for domestic law enforcement.
In response to global scrutiny over market manipulation and wash trading on event exchanges, offshore platforms have faced mounting pressure to refine their internal compliance systems, as seen in recent platform developments like the Polymarket exchange overhaul and integrity update.
Aligning Sporting Integrity with International Standards
SABA’s position paper explicitly aligns with warnings issued by international sporting governance groups, including the International Federation of Horseracing Authorities (IFHA). The trade body highlighted that unmonitored event derivatives enable spot-fixing and match-fixing by permitting participants to monetise specific micro-events or losing performances.
While licensed sports betting operators in South Africa contribute to integrity monitoring networks and pay local taxes, offshore prediction platforms operate without oversight from provincial gambling boards. Maintaining clean sporting competitions remains a primary goal for global regulators and integrity monitoring bodies, demonstrated by formal assessments such as when the FIFA Integrity Task Force reported no suspicious betting activity across World Cup 2026.
Outlook for South African Gambling Legislation
Until South Africa enacts dedicated legislative updates addressing cross-border crypto wagers, consumer self-exclusion, and AML checks, SABA maintains that prediction market operators should be barred from offering services in the country. SABA’s policy paper urges the National Gambling Board (NGB) and provincial authorities to take immediate administrative action against unlicensed exchanges to preserve market integrity and prevent tax revenue leaks, a demand that mirrors ongoing regulatory enforcement measures, such as the NGB’s verified operator portal compliance initiative aimed at steering consumers away from unauthorised online platforms.