Sportpesa ends contract with FKF

GOR MAHIA v EVERTON Everton star Wayne Rooney challenges Gor Mahia players Godfrey Walusimbi (left) Kenneth Muguna and Ernest Wendo (right) during their friendly match in Dar es Salaam, Tanzania, on July 13, 2017. [Stafford Ondego/www.sportpicha.com]

SportPesa ends contract with federation

Nick Mwendwa says they will take up the matter with Government

Football Kenya Federation faces Sh100m deficit in their yearly budget for salaries and national team incentives. 

SportPesa have made good their threat and terminated its contract with Football Kenya Federation (FKF) over the new tax regime.

In a letter to FKF, the betting firm’s CEO, Ronald Karauri, said: “We refer to our letter dated June 2016. Our attempt to have the 35 per cent tax imposed by the Government reversed have proved unsuccessful.

“As earlier informed, please note that all contracts between us stand terminated as from December 31, 2017.”

SportPesa was the federation’s official sponsor and had signed a Sh500 million five-year deal last year.

The company was also paying the Sh1 million per month salary for FKF technical director Andrea Spiers. The SportPesa pullout means FKF will either have to look for money elsewhere to pay Spiers, or the German will be forced to terminate his contract.

The betting firm also pays a huge chunk of Harambee Stars’ coach Paul Put’s salary, estimated to be close to Sh2 million a month and even this will be jeopardised.

SportPesa had also committed to pay Harambee Stars players Sh3 million for every win in the Africa Cup of Nations’ qualifiers.

As a result of the pullout, the federation will be left with a Sh100 million a year hole in their budget in what is expected to hurt the development of the game.

According to FKF President Nick Mwendwa, termination of the contract will hit them hard, and they are planning to take up the matter with the Government.

“It is a big blow for us. We want to engage the government and see how best this can be dealt with,” he said.

On Wednesday, High Court judge John Mativo dismissed a case filed by betting firms challenging regulations to control gambling

Justice Mativo ruled: “I find and hold that the new taxes do not infringe on the petitioners’ rights to property since they are aimed at serving a legitimate public interest. The legislation was legally enacted and it overrides the legitimate expectation of the betting firms.”

The government said it was working on implementing the sports lottery to raise enough money to run sports in the country.