Strategic Objective:

Programme 1 detailed on here

Programme 2 detailed on here

The Legal Division renders legal support and advisory services to the National Lotteries Commission in executing its functions as detailed in legislation. The legal division supports Strategic Objection 1 (SO1) of the Annual Performance Plan.

Besides the rendering of general legal services, the division continues to ensure legislative awareness on the implementation of the amended Lotteries Act (Act 32 of 2013); otherwise referred to as the Lotteries Act 57 of 1997, (as amended) including the regulations. The amended Act brought about new ways of doing business including strict timeframes for the adjudication of applications, payment of grants allocated and the process of review.

The division has focused its energy in ensuring that internal staff and different distributing agencies are familiar with the amendments. There were also issues of interpretation of the regulations that needed to be clarified or simplified, particularly regarding the issue of the “12 months cooling-off period” and exclusion of certain entities from NLDTF funding (e.g. Political Parties and Organs of State generally). The division continues to create awareness around all issues relating to legislative interpretation and application of the new regulations.

The legislative interpretation of the 12 months cooling-off period has been one of the most debated issues and there was a need for the NLC to devise a formal and uniform interpretation for implementation purposes.

Regulation 14 reads as follows:

No applicant to whom a grant was made by the National Lotteries Commission shall be eligible to apply for another grant within a period of 12 (twelve) months from thedate of receipt of that grant, irrespective of whether the project is different from the one previously applied for.

The provision ought to be interpreted and implemented as follows:

In instances of conduit applications which involve assisting/assisted organisations:

  • Applicability of this provision where the application for a grant is received through an agent, representative or conduit, in terms of Part II, Regulation 10 is interpreted as follows:
  The cooling-off period applies to the actual applicant and not the agent/conduit and/or representative.
  Should the conduit/agent or representative also apply for a project at the same time that they are assisting the applicant. they also become an applicant in that case and the cooling-off period applies to them.
  Where the applicant has applied through a conduit/agent or representative, they cannot subsequently apply by themselves before the 12 months cooling-off period expires.

The amended regulations also stipulate different categories of Applications that may not be considered by the Commission.

Part III of the regulations:

The National Lotteries Commission shall not consider applications for funding for activities implemented:

1(a) Outside the borders of the Republic of South Africa 
  • A project implemented outside the borders of South Africa would mean an instance where direct beneficiaries are on foreign land ( e.g. An NPO applying to fund an orphanage in Swaziland cannot be funded as NLDTF funds are meant to assist only South Africans).
  • NLDTF funds South Africans and the mere fact that the actual performance is on foreign soil should not create an impediment to funding. (e.g. If Athletics South Africa needs funding for activities implemented outside the borders of South Africa – funding will still be for South Africans and ordinary South Africans remain direct beneficiaries of this funding).
(b) By organisations established for profit or in furtherance of objective of a for-profit organisation
(c) By organs of state excluding, educational and welfare institutions
(d) By political parties

  • The NLC has defined a political party in terms of the Electoral Commissions Act 51 of 1996 which states as follows:
  A political party means “any registered party, and includes any organisation or movement of a political nature which publicly supports or opposes the policy, candidates or cause of any registered party, or which propagates nonparticipation in any election”.
  From the definition above, politically affiliated parties or associations supporting the cause of any political party will also not qualify for funding. It remains our view that the legislature could not have intended to exclude political parties yet include politically affiliated parties from funding.

The above changes in the interpretation of legislation are vital in ensuring effective implementation of the Regulations and will continuously be discussed with stakeholders to ensure that they fully understand these updates to the regulations.

Policy on Delinquent Beneficiaries

The Board reviewed the NLC’s policy on Delinquent Beneficiaries with the aim of supporting all beneficiaries who find themselves unable to comply with the terms and conditions of the Grant Agreement. Failure to comply is sometimes because of lack of capacity and/or knowledge on the part of funded organisations even though it has been observed that in various instances some organisations still fail or refuse to comply even after support has been provided.

The policy intends to create an environment of support and intervention to assist those that are in breach but still prefer to fully comply and to further list those that remain non-compliant, even after support and intervention is provided. A special committee has been appointed to deal with all these matters on a case-by-case basis and advice on the way forward regarding all beneficiaries finding themselves non-compliant.

In line with the policy, the Commission established the Delinquency Committee. The purpose of the Committee is to intervene by assisting beneficiaries prior to listing them on the delinquent register as well as to mitigate against fraudulent conduct. The Delinquency Committee acts independently and presides over matters brought to it with integrity, in an objective, fair, transparent manner and with due regards to the principles entrenched in the empowering legislative and/or policy framework.

The statistics of beneficiaries considered for listing are depicted below

Province  Listed  Listing rejected  Withdrawn/
referred to the
Outstanding  Total 
Eastern Cape  13  21 
Free State 
Limpopo  38  21  61 
Mpumalanga  11  13 
Northern Cape 
North West 
Western Cape 
GRAND TOTAL   76     16   26   120  

Most frequent reasons for final listing include:

Most frequent reasons for referral to the Administration:

Applications of all organisations who have been assigned delinquency status and placed on delinquency list are unable to access funding until their issues are resolved and others are assisted through various interventions to ensure compliance and therefore continued support by NLDTF. The Committee refers all identified trends to responsible divisions for development of mitigating strategies and structured capacity building opportunities.

Operations Forum for Review Committee

The division is responsible for the Operations Forum for Review Committee. The primary role of the Operations Review Forum is to independently receive, assess, prepare and present all reviews to the Board Review Committee in accordance with section 26H of the Lotteries Act.

The Operations Forum for Review Committee processed a total of 85 applications, of which 67 appeals were recommended to be upheld and 18 Appeals recommended for review by the Board Review Committee.

The graph below illustrates a disaggregation of basis for review presented to date to the Review Committee recommending to either review or uphold the decision of the Distributing Agency


Capacity building

In promoting public knowledge and awareness, the division continued to support and capacitate beneficiaries on matters relating to the understanding and implementation of the Grant Agreement and support with mediation and legal advice where applicable and required. The nature of the services offered by the NLC are such that processes needs to be created to ensure that we can respond directly to the needs of our communities and the division intends to ensure this support not only to provincial offices but to beneficiaries directly.

The division will continue creating an environment of openness, transparency and continuous dialogue with all stakeholders to ensure that support and assistance is given where needed and to minimise and/or avoid situations of possible conflicts that could result in unnecessary litigation. The division is committed to ensuring support and assistance.

The Legal Division continues to assist with mediation between the NLC and beneficiaries and/or between beneficiaries and their stakeholders to ensure that funds allocated for good causes are used for the purposes for which they were approved.

Because of this approach and interaction with beneficiaries the NLC is exposed to less litigation by aggrieved beneficiaries. There is currently only four cases in the litigation process with only three being matters where the NLC’s decisions are being challenged.

The division also manages the drafting of contracts on behalf of the NLC to ensure maximum legal protection and value for money on services rendered to the commission or outsourced by the commission to third-party service providers.

Promotion of Access to Information Act 2 of 2002

The division ensures full compliance with the Promotion of Access to Information Act in order to give effect to section 32 of the Constitution.

The NLC remains compliant with its reporting responsibilities and a section 32 compliance report has been submitted to the South African Human Rights Commission before the closing date of 31 May 2018.

The division will continue its support and advisory function to ensure that the NLC complies with its legislative mandate.

© NLC 2018