The National Gambling Board v The Free State Gambling Board

The Free State Gambling and Racing Board invited applications for special licences to operate slot machines for one year in 1998, before regulations were promulgated under the National Gambling Act 33 of 1996 and before a central electronic monitoring system was established. The National Gambling Board objected to this. The Free State Board launched an application for a declaratory order (effectively seeking confirmation it could not issue the licences), with the National Board supporting the application. One of 99 applicants (the 14th respondent) brought a counter-application to compel the Free State Board to consider all pending applications. The High Court dismissed the Free State Board's application and granted the counter-application. The National Board sought leave to appeal, which was refused by Lichtenberg JP on grounds the Board lacked locus standi, despite reasonable prospects of success. The matter came before the Supreme Court of Appeal.

• Whether special gambling licences issued under section 38 of the Free State Gambling and Racing Act 6 of 1996 are exempt from other provisions of that Act and the National Gambling Act 33 of 1996
• Whether the Free State Board could issue special licences for a period of one year under section 38 which refers to 'specified dates'
• Whether the National Gambling Board had locus standi to appeal despite not being an applicant in the original proceedings
• Whether special gambling machine licences could be issued before promulgation of regulations under section 17 of the National Act and establishment of a central monitoring system
• The interpretation of concurrent national and provincial legislative competence under Schedule 4 of the Constitution

The appeal was upheld. The Court set aside paragraphs 1(a) and 2 of the High Court order and substituted them with: (i) a declaration that the Free State Board is not entitled to consider or award the special slot machine licences applied for; and (ii) dismissal of the counter-application. Costs of the application for leave to appeal in the High Court were awarded against specified respondents who opposed (14th, 23rd, 26th, 37th, 42nd, 46th, 59th, 78th, 85th and 90th respondents jointly). Costs of the appeal (including costs of two counsel) were awarded against the 14th, 78th and 90th respondents jointly. The existing costs order against the Free State Board in the High Court remained undisturbed. No costs order was made regarding the application for leave to appeal to the SCA due to non-compliance with rules.

A special gambling licence issued under section 38 of the Free State Gambling and Racing Act remains a gambling licence subject to the general provisions of both the provincial and national gambling legislation. The phrase 'notwithstanding any other provision' in section 38(1) does not exempt special licences from all substantive requirements but only modifies specific procedural provisions relating to applications and objections. Special licences are limited to 'specified dates' meaning specific days for ad hoc purposes, not extended periods that would circumvent legislative schemes. Provincial gambling boards must comply with section 21 and take cognisance of the National Gambling Act's provisions, including requirements for ministerial regulations prescribing maximum numbers of gambling machines and central monitoring systems. A statutory body like the National Gambling Board has locus standi to appeal where it has direct and material interest arising from its statutory functions, even if it was not an original applicant.

Harms JA observed that if the Free State Board's interpretation were accepted, it could potentially grant any number of casino licences under section 38 for extended periods (even 10 or 50 years) despite section 13(1)(j) of the National Act limiting the Free State to four casino licences. This illustrates the absurd consequences of reading section 38 as creating a completely independent licensing regime. The Court also noted that if special licences were exempt from all other provisions, contraventions would not be punishable under section 86, and persons disqualified under section 22 could still hold special licences - further demonstrating the unintended anomalies. The Court acknowledged that its interpretation may limit the field of application of special licences but stated this fits the general scheme of the Act, noting special licences were never intended for major operations like casinos.

This case is significant for: (1) Clarifying the interpretation of concurrent national and provincial legislative competence under Schedule 4 of the Constitution and the application of section 150 requiring courts to prefer interpretations avoiding conflict. (2) Establishing principles for interpreting 'special' licensing provisions in regulatory statutes - such provisions do not create entirely separate regimes exempt from substantive requirements. (3) Confirming that regulatory bodies like the National Gambling Board have locus standi to appeal where they have statutory functions and direct material interest, even if not original applicants. (4) Demonstrating how provincial gambling legislation must be read in harmony with national gambling legislation to give effect to national norms and standards. (5) Illustrating purposive statutory interpretation to prevent circumvention of legislative schemes through creative use of special licensing provisions.