Introduction
In our past publication, we had discussed the impact of the Supreme Court ruling of November 2024, which nullified the National Lotteries Act (NCA), confirmed the authority of state governments to regulate gaming operations, and restricted the erstwhile national authority of National Lottery Regulatory Commission (NLRC). Some of the major industry concerns caused by the decision are (a) how to deal with multiple licenses from individual states and (b) the concerns of existing operators who had already paid substantial fees for licenses issued by the now-redundant NLRC.
Update
In order to address some of these challenges, the Federation of State Gaming Regulators of Nigeria (FSGRN) has formally signed the Subnational Reciprocity Licensing Framework, marking a historic milestone in the evolution of Nigeria’s gaming regulatory ecosystem. This framework allows operators to obtain a single license, granting them the ability to operate across all member states of the FSGRN. Under the framework, operators will receive a Universal Reciprocity Certificate (URC), which authorizes them to conduct Online Sports Betting, Online Casino operations, Public Online Lottery services, and Promotional Competitions across member states.
Furthermore, all operators previously licensed under the now-defunct NLRC are required to apply for the URC, to facilitate a smooth transition, the FSGRN has granted a full waiver of the 2025 licensing fees for all transitioning operators, provided they meet the required criteria set by it. These operators will instead be required to renew and pay the requisite license fees from January 1, 2026.
This strategy helps with the harmonisation of licensing framework in respect of lottery and gaming activities which are not bound by physical presence of operators in affected states. Below are few market implications of this development.
Market Implications
- 1. Unified Licensing for Online Games: As the URC covers only Online Sports Betting, Online Casino operations, Public Online Lottery services, and Promotional Competitions across member states, it remains critical for operators s to familiarise themselves with the individual state specific framework in respect of other lotteries and gaming activities which are not covered in the URC. Our regulatory tracker has been updated to provide operators with a birds-eye view of these updates.
- 2. Unified Framework for Member States and Duplicity Problems: Given that the URC will only apply to the FSGRN member states, non-member states may need to either accede to this framework or develop their respective frameworks. The current strategy adopted by non-member states is likely to impact the ease of doing business for operators covering such non-member states, as it may increase/decrease the challenge of multiple regulations and licensing regimes. The current twenty-two (22) member states include:
| 1. | Abia State | 4. |
| Bayelsa State | 7. | |
| Delta State | 10. | |
| Enugu State | 13. | |
| Nasarawa State | 16. | |
| Oyo State | 19. | |
| Taraba State | 22. | |
| Kaduna State |
Conclusion
Whilst the URC creates a significant milestone for the Lottery and Gaming industry’s attempt to achieve a more stable and predictable regulatory environment, the challenge around duplicity of regulation and compliance regime still subsists. For instance, there are over 10 states which are neither member of FSGRN nor do they have their state specific licensing framework. Perhaps, the success case from the URC regime may influence the direction of the non-member states in the future. Investors and operators will need to pay attention to the changing dynamics in the regulatory space. We have provided easy to read regulatory tracker for this purpose.
For more information on this article, please contact us at tmtpractice@aluko-oyebode.com.
