Confusion as betting firms race against June 30 deadline amid court battle over new regulator boss

Kenya’s gambling operators are racing against a June 30 deadline to secure fresh licences under a sweeping new regulatory framework, even as a court battle challenging the appointment of the head of the newly established regulator boss threatens to cast uncertainty over the transition process.

The deadline marks the culmination of the most significant overhaul of Kenya’s betting and gaming industry in more than five decades, following the enactment of the Gambling Control Act, 2025, which repealed the legal framework that had governed the sector since the 1960s.

Under the previous regime administered by the Betting Control and Licensing Board (BCLB), all gambling and betting licences automatically expire on June 30 each year.

However, under the new law, operators must undergo a mandatory and non-automatic licensing process overseen by the newly created Kenya Gambling Regulatory Authority (GRA) if they wish to continue operating from July 1, 2026.

The licensing exercise is taking place amid concerns over the legality of the appointment of GRA Director General Peter Maina Karimi, who was appointed in February 2026 to spearhead the transition to the new regulatory regime and supervise the issuance of licences.

A constitutional petition pending before the High Court challenges Karimi’s appointment, arguing that it failed to meet eligibility requirements set out in the Gambling Control Act, 2025.

The case, filed before High Court Judge Patricia Nyaundi by petitioner Patrick Mwashigadi, accuses the GRA board of ignoring provisions of the Gambling Control Act, No. 14 of 2025 when it selected Karimi.

According to court papers, the petition raises concerns of conflict of interest because Karimi was allegedly an active participant in the betting industry while being appointed to oversee and regulate the same sector.

The petitioner, Patrick Mwashigadi, thus says Karimi’s appointment was unlawful.

Mwashigadi’s lawyer, Abdirahman Mohamed, argued that the appointment breached the law.

“The appointment of the fourth respondent as Director General of the Gambling Regulatory Authority (GRA) vide the announcement dated February 26, 2026, is patently unlawful, ultra vires, null and void ab initio, as the fourth respondent is disqualified under the express provisions of the Gambling Control Act, No. 14 of 2025.”

Mohamed cited Section 8(1)(f) of the Act, which bars any person who has been a director, employee, or shareholder of a betting company from appointment to the authority unless they left the company at least five years earlier.

“The fourth respondent has been the Chief Executive Officer of M-cheza – a licensed gambling or sports betting operator in Kenya, continuously since 2016 to date, which is over 10 years, including the preceding five years, as evidenced by media articles, professional profiles, and public records. He therefore fails the statutory qualification and cannot lawfully make the required declaration under Section 8(1)(f) of no conflicting interests in the gambling sector.”

The petition also accuses the GRA board of material non-disclosure, alleging that it deliberately omitted the name of Karimi’s most recent employer in its announcement of his appointment.

“This is evidence that the respondents have committed a material non-disclosure by failing to name the exact position and company the 4th respondent (Karimi) was working at immediately before the appointment.”

The Act expressly bars individuals who have served as directors, employees or shareholders of gambling companies from being appointed to the regulator’s board unless they severed ties with such entities at least five years prior to their appointment.

Petitioners have pointed to Karimi’s previous tenure as Chief Executive Officer of betting firm mCHEZA, contending that his appointment presents a conflict of interest and potentially contravenes the provisions of the law.

Available records show mCheza is a franchise owned and operated by Acumen Communications Limited (ACL).

The allegations, however, remain contested, and the court is yet to determine whether the appointment was unlawful. Until such a determination is made, Karimi continues to oversee the authority’s operations and licensing processes.

Consumer rights lobby the Consumer Federation of Kenya (COFEK), an independent, self-funded and non-political consumer protection body, has sought to participate in the proceedings, underscoring the broader public interest implications surrounding governance, transparency and consumer protection within the gaming sector.

Despite the ongoing legal challenge, gambling operators must still comply with the June 30 licensing deadline or risk being locked out of the market.

The new regulatory framework introduces far-reaching reforms aimed at tightening oversight of the industry while promoting responsible gaming practices.

Among the changes welcomed by operators is the extension of gaming licences from the current one-year validity period to three years, providing businesses with greater operational certainty and reducing the frequency of renewal applications.

The law also introduces business-to-business (B2B) licences, requiring suppliers, technology providers and gaming service vendors to obtain approvals from the regulator.

Players are expected to benefit from the removal of withholding tax on winnings, although government proposals to reintroduce a 20 per cent withholding tax remain under consideration.

Foreign gambling firms seeking licences in Kenya will also be required to ensure that at least 30 per cent of their shareholding is held locally, a move aimed at increasing domestic participation and retention of economic benefits within the country.

At the same time, operators face significantly higher financial obligations.

The Act substantially raises minimum capital thresholds and security bond requirements, measures that industry observers say could trigger consolidation within the sector as smaller and medium-sized local firms struggle to meet the new compliance costs.

Industry stakeholders have expressed concern that although the Gambling Control Act has come into force, several critical supporting regulations have yet to be gazetted or approved, leaving operators without complete clarity on some technical requirements they must satisfy to obtain licences.

Nonetheless, Kenya remains one of Africa’s most lucrative gambling markets.

Industry estimates indicate that approximately eight million Kenyans participate in betting and gaming activities every month, generating nearly one billion dollars (about Sh129 billion) in annual gross gaming revenue.