Football Kenya Federation’s plans to improve football in the country have received a major blow following SportPesa’s official notice terminating its contractual agreement with the national sports body.
The futures of Harambee Stars Belgian coach Paul Put and FKF’s Technical Director Andreas Spiers, whose salaries were being footed either in full or in part by the sports betting firm hang in the balance, as does Kenya’s ambitious dream of making an appearance at the 2022 World Cup.
In a letter dated December 28, SportPesa Ceo Ronald Karauri says: “We refer to our letter of June 2016. Our attempts to have the imposition of 35 per cent tax reversed by the government has been unsuccessful. As earlier informed, please not that all contracts between us shall stand terminated on December 31, 2017.”
SportPesa lost a court case seeking to stop the government implementing a new tax law that will see betting companies taxed 35 per cent of their profits.
Other sporting entities with SportPesa sponsorship agreements including the Kenyan Premier League, football clubs Gor Mahia and AFC Leopards, and Kenya Rugby Union are also awaiting official communication from the gaming firm on their status.
SportPesa had long warned that the 35 per cent tax on their business would force them to disengage from their sponsorship obligations.
The new tax laws took effect at midnight on Sunday.
FKF Communications Officer Barry Otieno on Sunday revealed that a meeting between government and FKF officials had been scheduled this week to discuss this latest development.
“The FKF president (Nick Mwendwa) will have a sitting with the Sports Principal Secretary (Peter Kirimi) on Tuesday to deliberate on how best to navigate the situation without bringing unnecessary harm to local football,” he said.
FKF unveiled SportPesa as their official betting partners on June 30 last year amid pomp and glamour. The agreement was for five years, and although the official figures involved weren’t revealed, the deal was believed to be in the region of Sh70 million every year.
The betting company would also cater for the full expenses of German coach Spiers as part of Kenya's qualification plans for the 2022 World Cup.
All these plans have now been thrown into disarray.