Safa to target betting companies to pay 'fair share'
Safa believes it should receive a fair share from these companies who conduct betting on Safa events.
CAPE TOWN - As the South African sports betting industry grows exponentially, the South African Football Association (Safa) is eyeing the revenue of these private wagering operators who receive bets on their Safa products (Bafana Bafana, Banyana Banyana, etc).
Safa believes that they should receive a fair share from these companies who conduct betting on Safa events, the vast majority of bets placed stems from football, said to be between 60% and 90%.
In the last six years, the sports betting industry in South Africa has grown by 450% to a whopping R39.7 billion. The betting companies are said to take home roughly R3.5 billion according to Safa.
Safa leadership were in Parliament this week where they tabled this new proposal.
Acting Safa CEO Russel Paul explained to EWN Sport the reasons and thinking behind a possibly game-changing piece of legislation.
"We've obviously approached, and we indicated this challenge to the portfolio committee and we are saying that it's a (possible) source of revenue, not just for football, but for sport in general in this country. So, in our case it would be Safa, in the case of rugby, it would SA Rugby.”
Paul added that the private betting companies are leveraging and receiving income off Safa events.
"They're utilising a property that does not exist. They didn't create this property, this property and the intellectual property rests with the sporting controlling body.
"What is the property that allows you to bet? The property that allows you to bet is the sport. Without the sport they can’t bet, there's nothing to bet on. So how can they use the sporting properties without providing financial support to those controlling bodies?
"We put those matches on every single week, so it's not them who have invested to do the game. It cost us to do a Bafana game somewhere between R4.5 million to R6.5 million, we get nothing from them, but they achieve the revenue from that match when they bet on it.
“It's a different ballgame if they were coming along and say we will pay for every single match then you could certainly say okay now we understand, but it's not their property and football has long been there long before betting actually found its way into the commercial environment.
With the industry growing faster than most industries in South Africa, Paul wants government support to change legislation and believes they can also benefit from a new model where betting companies pay their "fair share".
"We are saying that from a government perspective, the government can obviously dictate the percentages.
“We are requesting the portfolio committee for Sport and Recreation to assist us and to give us guidance. And obviously we will be talking to the (Department of Trade and Industry) DTI as well, it's probably the right area to fall in. We believe that it is an ideal avenue for sport to achieve greater revenue streams."
Paul indicated the committee was intrigued by the proposition that was tabled by Safa.
"Very well, for them, it was a bit of an eye-opener as well. They don't understand why this avenue has not been tackled before."
Changing national legislation for betting companies for the benefit of sport is not new according to Paul, in fact, he provided global examples.
"We’ve also indicated that the Department of Sport itself could be a beneficiary and could help them with the budget challenges that they have. These models are working exceptionally well in France and Australia, etc.
"There are best practice models around the world - France, Australia, New Zealand etc - where the betting companies need to seek permission from the sports controlling body."
Communication between the respective betting companies and Safa have not happened as yet, but Paul hopes the parties can find an amicable solution instead of bringing the law into the game.
"We are talking to the necessary parties, we are wanting to set up meetings. Even if they don't take kindly to it, if legislation prohibits them from utilising the sport, they will find themselves at the wrong end of the law. So, we are saying let's work together. Let's work together to legitimise the process and to achieve mutual benefits."
Safa made an R18 million loss in the last financial year and their much-publicised scuffle with the SABC over broadcasting rights as seriously affected their bottom line.
The body is in desperate need for new revenue streams and a change in legislation could provide that. This law change will have implications for other sports as well.