Kedah govt cant ban pool betting, lotteries on moral grounds, says court

Court of Appeal says licences can only be refused over premises-related issues such as safety, sanitation, causing a nuisance, or zoning compliance.

In a majority decision, Justice Faizah Jamaludin said that state governments’ powers are confined to matters under the Ninth Schedule of the Federal Constitution and the Local Government Act.

She said the state government may regulate licensing based on premises-related factors, including building conditions, safety compliance, sanitation, causing a nuisance, and the suitability of locations.

“Local councils may deny business licences for pool betting operators if there are defects in their shoplots, (unfulfilled) safety requirements, sanitisation issues, or they are causing a nuisance.

“However, the refusal (to issue and renew business licences) reflected a policy objection to betting and lotteries, rather than concerns about the building or premises they occupied,” she said in the court’s grounds of judgment released last week.

Faizah also noted that some operators had been occupying the same premises for 38 years.

Last December, the Court of Appeal dismissed an appeal by the Kedah government seeking to reinstate its decision not to renew business premises licences for pool betting and lottery operators.

Faizah and Justice Lim Hock Leng upheld the High Court’s decision to quash the Kedah government’s decision.

Chief Judge of Sabah and Sarawak Azizah Nawawi dissented, holding that the Kedah exco’s decision fell within its legal scope under the Local Government Act.

Faizah also noted that licences issued by the finance minister are subject to strict federal conditions, including requirements such as printing a note on tickets that gambling is prohibited for Muslims.

“The federal regime, therefore, proceeds on the footing that pool betting, though lawful, is controlled,” she said.

“For the appellants (state government) to say that the finance minister did not issue licences to the operators in 2023 because of their being, therefore, is wrong.”

Dissenting, Azizah said the state executive committee’s decision fell within its powers under the Local Government Act and represented a legitimate policy choice.

She maintained that it was a policy decision and that the courts should not interfere.

“The decision reflects a deliberate prioritisation of the collective interests of the people of Kedah (against the effects of gambling) over the interests of any individual or specific entity, she said.

The Federal Court will hear the Kedah government’s application for leave to appeal on Aug 12.