Nairobi County sues Kenya Kwanza government over control of gambling billions

Nairobi County has stoked a court battle with the National Government over the collection and control of billions of shillings from betting companies and casinos through licensing.

In its case filed before the High Court, the Johnson-Sakaja-led county cited duplication of regulatory roles.

The county’s lawyer, Faith Wanjala, urged the court to find that the Gambling Control Act (2025) and Gambling Control (licensing) Regulations, 2026, violate devolution and the separation of powers between the national government and counties.

“The impugned legislation creates a national framework which does not adequately distinguish the government’s constitutional function of national betting casinos and other forms of gambling and county government’s function of betting, casinos and other forms of gambling,” argued Wanjala.

She stated that currently, a person interested in betting, or the casino business in the capital city, must acquire a license from the Gambling Regulatory Authority (GRA) while also complying with the Nairobi City County Betting, Lotteries and Gaming Act, 2026.

“The continued operation of the impugned provisions also exposes gambling operators within Nairobi County to competing licensing and regulatory requirements, with the attendant risk of double licensing, duplicate fees, overlapping inspections and conflicting enforcement measures,” said Wanjala.

The county sued the Attorney General, the Prime Cabinet Secretary Musalia Mudavadi and GRA.

The lawyer said Article 186 and Part Two of the Fourth Schedule assign County Governments the functions of betting, casinos, and other forms of gambling.

She further observed that Part One assigns the National Government the functions of betting, casinos and other forms of gambling.

Wanjala argued that the ambiguity in the law has created an overarching role for GRA.

“The impugned provisions vest the Gambling Regulatory Authority with extensive licensing, regulatory, supervisory, inspection and enforcement powers over gambling activities, thereby creating a substantial overlap with the constitutional and statutory mandate of the petitioner,” she argued.

Wanjala stated that GRA, on March 20, 2026, acknowledged that there was a risk of double licensing, increased compliance burden and confusion.

She, however, noted that the authority demanded that the county should cease collecting gambling license fees, charges and penalties.

“The petitioner is particularly aggrieved by the provisions of the Gambling Control Act, 2025 and the regulations which confer upon the third respondent licensing, regulatory, inspection, supervision and enforcement powers over gambling activities generally, including activities falling within the constitutional sphere,” she stated.

In his supporting affidavit, Nairobi County’s acting director, gambling, betting and lotteries, Alvin Mayoya claimed that GRA had admitted that it was doing the county’s work. He, however, also claimed that the authority imposed on the county to yield its functions.

“The continued implementation may further result in the issuance of national licenses and the imposition of national regulatory requirements in respect of activities which the petitioner contends fall within the constitutional mandate assigned to the county governments,” said Mayoya.

He asserted that the county does not want to block the National Government from carrying out its share of functions. Instead, he said, the case was about preventing it from meddling with the county’s work.

From the exchanges between GRA Director General Peter Karimi and Sakaja, the authority stated that it was concerned about the collection of county gambling fees under a new county framework. This was on May 20, 2026. Kirimi sought a meeting to sort out, among other issues, double licensing and compliance enforcement.

On July 3, 2026, he sent a circular announcing the 2026 licensing cycle.

There are other separate cases challenging the same regulations.

Lawyer Biketi Wati, in his case filed under urgency, argued that the new regulations were sneaked through Parliament. He said that several components, including the new charges, were not part of what had been submitted to the public for review and input.

In the initial case, two lawyers, Thomas Buckley Opal and Ken Brance, sued the GRA, the AG, the Musalia Mudavadi, arguing that the new regulations would cripple the industry and were allegedly passed without public participation.

Opal and Brance explained that the 2026 regulations were passed amidst confusion on who among the Cabinet Secretaries is responsible for gambling.

They accused Kenya Kwanza of deliberately leaving out the crucial role of managing the industry from the organogram. They stated that this left gambling firms without anyone to ask questions. According to them, this role was initially assigned to the Public Service, Human Capital Development and Special Programs, Geoffrey Ruku.

Nevertheless, they complained that the fees introduced in the new law range from 200 per cent increase to 49,900 percent increase.

According to the two, an online bookmaker application fee was initially Sh 10,000. However, the new fee applied is Sh5 million. For pool and betting license renewal, the players were paying Sh 5,000 but are now required to pay Sh2.5 million, the same as the bookmaker application fee, which was previously Sh 10,000.

They further claimed that for an online bookmaker license fee, the amount was increased 24,900 times, from Sh200,000 to Sh50 million.

Opar and Brance asserted that the government had allegedly ignored Parliament’s recommendation while increasing the fees.

At the same time, they lamented that the advertising fee had been increased by six percent.

“The Act's Third Schedule requires Sh20 million security for casinos, but the Regulations' Third Schedule (titled "gambling capital requirement") requires Sh100 million gambling capital for casinos. The respondents have deliberately and unlawfully imposed a financial requirement that is 500 per cent higher than that which Parliament deemed sufficient,” they continued.

The two lawyers argued that the authority was on the verge of ordering closures and deactivation of gambling channels.

Justice William Musyoka blocked the gambling authority from implementing the new regulations.

However, Karimi moved back to court, arguing that the court had allegedly crippled its ability to process licenses.

Karimi alleged that the fees and the new rules were a result of consultations with the stakeholders.

He stated that the requirements for gambling firms must have insurance coverage, and for gambling capital was out of caution that they must have the financial capacity necessary to establish and sustain such operations.

In his further reply, Opar, who said he is a consultant advising licensed gaming operators, stated that the new regulations had simply knocked out the majority of betting firms as very few would sustain such fees and insurance premiums.

According to him, the implementation of the regulations would be unfair as there are no channels of refund if the betting firms comply.

 He said that GRA had already notified mobile service providers on July 3 that it would require the new regulations to be implemented before they issued them with the payment channels.

Karimi on the other hand insisted that the communication was in relation to new applicants and not those who are renewing their licenses.