Regulatory compliance

Gaming licences are extremely valuable assets to the group. These are issued for an indefinite period (with the exception of the Eastern Cape- based licences) and are maintained through a strict compliance culture including compliance with all laws and regulations to which the group is subject.

This strict culture of compliance is applied to all aspects of the group’s business including areas as diverse as hospitality hygiene, liquor licences, fire and life safety regulations and competition law.

Despite the significant cost involved, the group treats compliance as a necessary investment and not an unavoidable cost, and recognises that compliance yields benefits such as an enhanced financial and operational internal control environment.

Key performance indicators

  2014   2013  
Gaming regulation breaches   Nil   1  
Fines imposed for other regulatory breaches   Nil   Nil  
Fines imposed for breaches of law   Nil   Nil  


2014 performance

Regulatory compliance

The South African trading environment is highly regulated and compliance with the regulations is critical to our licence to trade. The broader trading environment is becoming increasingly complex and is governed by legislation, much of it relatively new, relating to competition, customer protection, privacy, environmental, health and safety, money laundering and labour issues. A number of statutes provide for monitoring and enforcement by regulatory bodies. The audit and risk committee is updated with all material changes to legislation and regulations twice a year and the board is updated quarterly.

The casino operations are regulated by the provincial gambling boards and, from an oversight perspective, by the National Gambling Board. The standards of regulation within the industry are in line with global best practice. Gaming regulation compliance, which is of particular importance in retaining casino licences, is achieved through the implementation of internal control procedures and compliance policies, compliance committees, an anonymous tip-off system, interventions with regulators and law enforcement agencies, centralised specialist understanding of the interpretation and application of legislation, internal and external compliance audits and by creating a compliance culture through training. Compliance with the terms of a licence is monitored by the relevant provincial gambling board on an ongoing basis and certain provinces may conduct quarterly, bi-annual and annual inspections.

During the year, the regulatory universe was defined to identify all laws that are applicable to the group. A total of 103 of the national acts were identified as potentially being applicable to the business. The applicable acts and all relevant provincial regulations were then prioritised to assess the inherent and residual risks. The most significant areas of regulation were identified as:
  • Basic Conditions of Employment Act, Labour Relations Act and Employment Equity Act;
  • Broad-Based Black Economic Empowerment Act and Codes of Good Practice;
  • Competition Act;
  • Consumer Protection Act;
  • Financial Intelligence Centre Act;
  • Foodstuffs, Cosmetics and Disinfectants Act and Meat Safety Act;
  • Liquor Act, Liquor Products Act and liquor licences and regulations;
  • National Gambling Act and the provincial legislation and regulations;
  • Occupational Health and Safety Act;
  • Protection of Personal Information Bill; and
  • Tobacco Products Control Act.

Tsogo Sun ensures that the group complies with all applicable legislation in all countries in which it operates and, where practical, builds constructive relationships with the regulatory bodies. There were no significant breaches of any legislation during the year.

Looking ahead

Following the definition of the regulatory universe during the year, a formal compliance framework will be documented for material areas of regulation to ensure that all relevant legislation and regulations are applied and adhered to.