How does Kedah’s lottery ban conflict with federal licensing?

Question

Accepted Answer

Kedah's Refusal to Renew Lottery Premises Licences Conflicts with Federal Authority

The Kedah state government's decision to cease renewing premises licences for lottery operators, despite these businesses holding valid federal licences, presents a constitutional conflict. The core of the dispute lies in whether a state can use its local government powers to prohibit an activity that falls under the federal government's legislative purview. The Court of Appeal previously ruled that such a blanket refusal by the Kedah government was unconstitutional, as it effectively impeded the federal government's authority to license and regulate pool betting businesses.
State Authority vs. Federal Licensing Powers

The Federal Constitution delineates specific areas of legislative power. "Betting and lotteries" are explicitly placed under the federal government's law-making powers. Conversely, "local government" functions fall under the purview of state governments. This division means that while local authorities can regulate aspects of business premises such as safety, sanitation, and suitability of location, they cannot use these powers to prohibit an activity that has been federally licensed. The Kedah government's action, as interpreted by the Court of Appeal, went beyond regulating premises and instead aimed to prohibit a federally permitted business.
The Impact of Non-Renewal on Federal Licences

Lottery operators in Kedah have been unable to operate their physical outlets since 2023 because their premises licences were not renewed by the state. This occurred even though the Finance Minister had renewed their annual pool betting licences for the entirety of 2023. This situation created a scenario where businesses held federal authorization to operate but were prevented from doing so by the state's refusal to grant the necessary local licences for their physical locations. The previous judicial decisions have indicated that this inability to operate physical outlets effectively nullifies the federal licence within the state.
Court of Appeal Ruling on State Overreach

The Court of Appeal, in a 2-1 decision, found that the Kedah state government's blanket refusal to issue premises licences to pool betting businesses was unconstitutional. The judges reasoned that the non-renewal was not based on any defects in the premises themselves, such as safety or sanitation issues, but rather on the state's disapproval of the activity itself. This approach was deemed an overreach of state authority, as it interfered with the federal government's exclusive power to license and regulate lotteries. The ruling emphasized that state executive authority must not impede federal authority, as stipulated by Article 81 of the Federal Constitution.
The Federal Court Appeal

The Kedah state government is now seeking permission from the Federal Court to appeal the Court of Appeal's decision. The ultimate aim is to gain the legal standing to pursue its objective of stopping lotteries from operating within the state. The case before the Federal Court is expected to centre on complex questions of law concerning the division of powers between the federal and state governments, specifically how state powers in local governance interact with federal powers in licensing and regulating specific industries like pool betting.

Reading history

Hide →

This history is cleared when the page is closed.

How does Kedah’s lottery ban conflict with federal licensing?

Loading

Was this article helpful?

Helpful

Not helpful

Report an issue

2

0

0

Share with friends