National Lottery Authority sues Airtel over "illegal lottery"

Accra, March 15, GNA - The National Lotto Authority (NLA) has initiated moves to halt activities of telecommunications operators from promoting, conducting, running and advertising illegal lottery or games of chance disguised as marketing promotions.

The move has come in the wake of several games of chance being introduced onto the Ghanaian market by telecommunication operators. The NLA has therefore filed a motion on notice for an interim injunction at the Fast Track High Court against Airtel Ghana Limited and the National Communications Authority (NCA).

In the motion, the NLA is seeking an order restraining agents, servants, assigns and privies of Airtel Ghana Limited from promoting, sponsoring and advertising the ongoing Airtel 93Freedom to Dream" or engaging in a game of chance in any form.

The NLA is also seeking an order to prevent Airtel from conducting and supervising any draw on its network including 93Crack and Win" disguised as marketing promotions.

Again the NLA is seeking a declaration that Airtel's Freedom to Dream is not a promotion but, in fact in law, a lottery, which is prohibited by section 4 of the National Lotto Act of 2006, Act 722. The NLA is further seeking a declaration that Airtel's operation of lottery without the requisite statutory license is illegal and unlawful in that it had failed to comply with mandatory statutory provision of the Lotto Act. It is also seeking general damages and special damages.

NLA is seeking a declaration that the value or the cost of the top-up or airtime required as a precondition to participate in the "Freedom to Dream" promotion represents a consideration which is required by Airtel to enable qualifying entrants to participate in the draw to win any prize or reward.

In the case of the NCA, the NLA is seeking, among others, an order compelling the NCA to exercise its statutory mandate under its Act and the Electronic Communications Act, 2008, (Act 776) to develop guidelines for marketing promotions by mobile network operators in accordance with international best practices of telecommunications regulators in other jurisdictions, thereby protecting consumers' interest and prevent illegal lottery activities disguised as marketing promotions.

It is also seeking an order that it is the statutory function and duty of the NCA to classify services provided by mobile network operators and determine whether Airtel's purported promotions could pass as value added services or permissible communications or marketing services under the NCA's Act, Act 2008 and act 769. In NLA's statement of Claim, it said it was the statutory body established by National Lotto Act, 2006 (Act 722), which was vested with authority to regulate, supervise and manage national lotto as well as ensure the enforcement of laws relating to the National Lotto. The NLA noted that over the past years, mobile network operations in the country had persistently and unlawfully engaged in lottery in the form of games of chance in clear breach of the spirit and letter of the National Lotto Act.

According to the NLA the purported promotions had drawn public comments in the media as being akin to gambling. It said consumer rights organizations had described such purported promotions as 93illegal, misleading, fraudulent, non-transparent and exploitative of unwitting subscribing consumers to mobile network services in Ghana".

As a result in 2010, the Minister of Communications directed NCA to investigate to determine that such purported promotions were in breach of the laws of the land.

The NLA said after the directive, the NCA which was vested with the responsibility of protecting the consumers, failed to take "definitive legal and public position on the matter". According to the NLA the illegal lottery and games of chance of the mobile networks have negatively impacted its (NLA's) operation resulting in the loss of millions of cedis in revenue and unpaid Value Added Tax (VAT) and other taxes due government.

The NLA said in February this year, amidst pomp and pageantry, Airtel launched another lottery game, disguised it as marketing promotion by name 93Freedom to Dream" slated to run from February to March 2011. It noted that Airtel has further launched another game known as "CRACK-THE-SAFE" NLA said these promotions were in breach of the National Lotto Act.