How Gambling Licensing Frameworks Shape National Economies and Player Safety
AI-GENERATEDA new analysis explores how licensing structures impact national revenue and investment. South Africa saw $89 billion wagered in the 2024-25 financial year.
A gambling licence is far more than simple paperwork for lawyers and businesses. It represents a fundamental economic policy decision that affects national revenue, business investment, and consumer confidence. As online gambling continues to expand, governments face a classic dilemma: if regulation is too light, consumers face greater risks; if it is too complex or costly, players migrate to offshore operators that pay no local taxes and operate without oversight.
The discrepancy between regulation on paper and reality remains a significant hurdle. In the Democratic Republic of Congo, for example, insiders estimate that iGaming generates nearly $1.7 billion in annual revenue, yet the government has reportedly received only about $1 million in taxes. This illustrates that a licensing framework is only as good as its enforcement. Effective oversight requires trained staff, reliable data, and the legal power to trace payment flows and ownership structures across multiple jurisdictions.
Numbers and facts
The economic scale of the industry is highlighted by South Africa, the region's leading market. During the financial year 2024-2025, a reported 1.5 trillion ZAR (approximately $89 billion) was wagered. Jon Russell, former director of Betway Group, notes that South Africa set the template for African regulation with the National Gambling Act in the late nineties. He points out that regulatory attitude often determines where legitimate operators build, citing the Western Cape as a historically progressive regulator that accommodated corporate structures early on.
In Botswana, the government has initiated a review of its National Gaming and Gambling Policy from 2002. This policy predates the rapid rise of digital platforms and evolving consumer habits. The Ministry of Trade and Entrepreneurship is partnering with the Gambling Authority of Botswana and the Botswana Institute for Development Policy Analysis (BIDPA) to ensure the new framework aligns with modern economic objectives and responsible gambling standards.
"Depending on how one defines 'regulated', only a relatively small number of African jurisdictions currently have mature, actively enforced licensing systems with meaningful compliance oversight." - Sean Coleman, CEO, South African Bookmakers' Association
Background
Licensing rules decide who enters a market and what they must prove regarding finances, technology, and responsible gambling controls. High fees and lengthy applications tend to favour larger companies, while weak checks expose customers to risk. Furthermore, cross-border markets complicate enforcement. An operator might be registered in one country, host technology in another, and process payments in a third. This makes information-sharing between national regulators vital to address money-laundering risks and unlicensed activity.
Why it matters for German players
For players in Germany, the findings regarding offshore migration are particularly relevant. The German Interstate Treaty on Gambling 2021 (GlüStV 2021) introduced strict limits, such as the 1,000 Euro monthly deposit cap and the 1 Euro per spin limit for slots. While these measures aim to protect players, the international analysis suggests that if the legal market becomes too restrictive or expensive, players might seek out offshore casinos. In Germany, the Common Gambling Authority of the States (GGL) works to prevent this by maintaining a whitelist of legal operators who adhere to high safety standards.
What it means for GGL-licensed casinos
Casinos holding a GGL license face high compliance costs compared to unlicensed offshore competitors. The study emphasizes that a predictable tax system and consistent regulatory decisions are necessary for businesses to plan effectively and hire locally. For German operators, this means that maintaining their GGL status requires constant technical adaptation to systems like LUGAS. Ensuring that legal activity stays within the taxable market is not just a regulatory goal but a necessity for the economic health of the domestic gambling sector.
Frequently asked questions
What impact do high gambling taxes have on the market?
Higher taxes may increase revenue per operator but can reduce competition and make offshore sites more attractive. This can lead to a decrease in total tax revenue and discourage long-term investment in the local economy.
Why is Botswana reviewing its gambling policy?
The current policy dates back to 2002 and does not account for digital betting platforms or modern consumer behavior. The review aims to update the framework to reflect current technological and market realities.
How much is wagered in the South African gambling market?
In the 2024-2025 financial year, approximately 1.5 trillion ZAR was wagered in South Africa, totaling about $89 billion. It remains the most mature and actively enforced market in its region.
What is the main challenge of cross-border regulation?
Operators often split their operations across different jurisdictions for technology and payments, making it hard for national regulators to track money flows. International cooperation and information sharing are essential for effective enforcement.
Why should German players stick to GGL-licensed operators?
Only GGL-licensed operators follow the strict safety standards of the GlüStV 2021, including deposit limits and player protection. Playing at offshore sites leaves consumers without legal recourse in case of disputes or payment failures.
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About the author

Lisa Lustich
Editor-in-chief & casino tester
Lisa Lustich has been testing German-language online casinos since 1997 and runs the Lustich.de newsroom. More than 400 published reviews, certified player-protection advisor (BZgA training, 2019).
All articles by Lisa Lustich →Sources & further reading
- Joint Gambling Authority of the German Federal States (GGL): gluecksspiel-behoerde.de
- Whitelist of permitted online operators: GGL-Whitelist
- BZgA problem-gambling helpline: 0800 1 372 700 (free, anonymous, 24/7)
- Editorial methodology: Editorial guidelines Lustich.de
Gambling can be addictive. Please play responsibly. Help and counselling at 0800 1 372 700 (BZgA, free & anonymous).
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