Court orders minister to consider lottery licence bids afresh

The Pretoria High Court has set aside Minister Parks Tau’s decision to award the fourth national lottery licence to Sizekhaya Holdings. Illustration: Lisa Nelson

• Judge Norman Davis has set aside Minister Parks Tau’s May 2025 decision to award the fourth national lottery licence to Sizekhaya Holdings.
• The Pretoria High Court found that a ministerial committee had unlawfully conducted a parallel evaluation and that its recommendations had influenced the minister’s decision.
• The review was brought by unsuccessful bidders Ithuba Lottery and Ringeta Consortium.
• The court ordered Tau to reconsider the bids without taking the committee’s report into account, but suspended the invalidity order for 12 months to allow time for a fresh decision and, if necessary, a new licence agreement.

Minister of Trade, Industry and Competition Parks Tau has been ordered to go back to the drawing board and reconsider the bids for the fourth lottery licence, which he awarded to Sizekhaya Holdings in May 2025.

In a ruling handed down on Monday by Pretoria High Court Judge Norman Davis, the minister has been directed to specifically exclude any consideration of a ministerial committee report on which, he admitted, he had to some extent relied when making the award.

Judge Davis said this was impermissible.

While he reviewed and set aside the minister’s decision and declared the licence agreement to be invalid, the judge suspended the declaration of invalidity for 12 months, giving the minister six months to decide to award the licence afresh and a further six months to negotiate and conclude a new licence agreement, should the decision be to not award it again to Sizekhaya.

This means that Sizekhaya’s licence remains operational for now and the lottery can continue to run.

The challenge before Davis was brought by two unsuccessful bidders, Ithuba Lottery and Ringeta Consortium. Also, the Economic Freedom Fighters (EFF) challenged the constitutionality of provisions of the Lotteries Act dealing with financial interests of political office bearers in bidders for lottery licences.

The matters were heard at the same time in July this year.

Davis described in detail the formulation of the Request for Proposals (RFP), an essential element of a valid evaluation process. He said it provided for a three-stage process involving evaluation of the bids, adjudication of the bids, and the minister’s decision after consultation with the National Lotteries Commission.

The minister, after consultation, had however said he was not in a position to award the licence and had delayed taking a decision.

The evaluation committee had ranked Ringeta first, and the National Lotteries Commission (NLC) adjudication committee had recommended Ringeta as preferred bidder with Sizekhaya as reserve.

The minister had then appointed a ministerial committee to re-assess the bids and recommend the names of the preferred and reserve bidders.

The committee had recommended Sizekhaya as the preferred bidder and Ithuba as the reserve bidder.

A month after the minister awarded the licence to Sizekhaya, Ithuba instituted its review application.

In June 2025, amaBhungane reported alleged family links between people in Sizekhaya and deputy president Paul Mashatile. Tau instructed the NLC to investigate this.

But, Davis said, “up to the time of the hearing of this matter, no report of such investigation had featured in the [court] papers”.

Countering the central argument by Ithuba that he was not entitled to establish a committee not provided for in the RFP, Tau said the committee had only assisted him with evaluating concerns that had arisen from material already before him.

He said its report and recommendations were not determinative but rather helped him consolidate and address matters.

Sizekhaya, he said, had robust technical capabilities and its projected contributions to lottery funds were higher than those of other bidders.

In his ruling, the judge said “on a pure linguistic evaluation of the provisions of the RFP”, the minister was not entitled to create a new committee which had run a “parallel process” to that of the evaluation and adjudication committees and conducted a complete re-evaluation, without the bidders’ knowledge.

“New evaluations were performed with the use of new consultants which resulted in new rankings and preferences of bidders.

“The results of this ‘parallel process’ were adopted by the minister, despite his disavowal thereof, to the extent that his reasons for his decision … often followed the ministerial committee’s recommendations word for word.”

The judge said this was unlawful and procedurally unfair, and directed the minister to reconsider the bids afresh.

Judge Davis dismissed the EFF’s application which sought to expand the scope of the Act to prevent political office bearers from having any financial interest in the bidders, whether direct or indirect.

Davis said this needed to be pursued by legislative reform, noting that the RFP had already broadened the prohibition to include indirect financial interests.

In the EFF matter, he ordered the parties to pay their own costs. In the Ithuba and Ringeta matters, he ordered the minister, the NLC and Sizekhaya to pay the costs.

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