Ukraine Updating Its Gambling Regulation System
Ukraine is making an effort to update and improve the way it regulates gambling.
Key Facts:
- Volodymyr Zelensky signs key amendments into law, heralding change for gambling regulation.
- A new regulator will replace the current one, which is linked to corruption.
- Other measures are designed to overhaul gambling and improve its regulation.
Ukraine is looking to improve the way it regulates gambling. On 3 January, Volodymyr Zelensky signed new gambling amendments into law. These contain various updates and changes that should make the country’s regulation of gambling and lotteries much better than before.
Before the war, there were already concerns about KRAIL, the country’s former gambling authority. The organization was linked with both bribery and corruption. Since the war started, more problems have arisen and affected the country’s gambling sector in one way or another.
The National Security and Defence Council’s intelligence agency felt the need to look more closely at Ukraine’s gambling licences owing to the chaotic and unpredictable events of the war. The agency placed sanctions, including limits on transactions and other restrictions, on many licence holders.
It’s been suspected that there has been some degree of Russian interference in the Ukrainian gambling sector. Bearing this in mind and everything else that’s happened, it should come as no surprise that the government wants to reset its gambling regulation and set a new standard for the future.
A New Regulator
As part of the new amendments signed into law by Zelensky, Ukraine will have a new gambling regulator that will replace KRAIL. It is scheduled to be up and running by April 2025. Ivan Kurochkin, 4H Agency’s Head of Consulting, has said that state control will be the focus.
While the final details of the regulator haven’t been announced yet, 4H Agency is aware that the regulator will adhere to three core principles. These are as follows:
- The Ministry will control the new regulator and its structure will be determined by the Cabinet of Ministers; the previous one will be liquidated.
- The new regulator will have the authority to impose limits on both the time and money people spend gambling.
- It will also have greater powers including the right to block illegal gambling sites, enforce sanctions and cancel licences.
As part of the amendments, there will be a severe crackdown on gambling advertising. It will still be permitted, but with lots of restrictions in place to ensure that underage and vulnerable people aren’t exposed to it too much. The legal age for gambling will remain at 21.
Gambling adverts will only be allowed on TV between the hours of 11 pm and 6 am. As for the internet, there’s no time restriction, though ads aren’t allowed to target people under the age of 21. Lastly, gambling companies are only allowed to form sponsorship deals with sports teams and no other brand types.
Further Details
Updates are being made to the State Online Monitoring System (SOMS) to improve the transparency of data and the enforcement of data-related rules. Operators of gambling sites will only be able to make payments through banks. Also, lotteries are going to be regulated in the same way as gambling sites.
Lotteries and gambling sites used to have to meet reporting standards, which were paused when the country enacted martial law. This will be resumed going forward. Lastly, all companies that offer gambling services or provide software must obtain a licence so they can operate with B2C companies.
Previously, providers based in other countries were able to offer their products and sign deals with Ukrainian companies. Now, foreign providers will have to complete an extra step by obtaining a licence if they wish to do this. The idea is to create a level playing field for all gambling companies.
Looking to the Future
When the amendments come into effect, they will mark the beginning of a new age for gambling in Ukraine. It’s all about bringing the way it regulates gambling in line with other countries and giving players better, more robust protection. Hopefully, there should be a decline in the number of problems related to gambling.
Having said that, there are still some changes that the government can make. As Ivan Kurochkin notes:
Clear challenges remain for Ukraine. The unresolved issue of taxation continues to complicate the operational environment for legal operators, as the Ukrainian Tax Code still does not fully accommodate the specifics of the gambling business. Additionally, the economic uncertainties stemming from the ongoing military situation pose additional risks for market growth.– Ivan Kurochkin, 4H Agency, Ukrainian agency comments on gambling regulation updates, SBCNews
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4H Agency will continue to monitor Ukraine’s gambling industry to see how effective the measures will be. Their success depends on how well they’re implemented and how closely Ukraine’s new regulator keeps an eye on things. The country’s gambling market has the potential to attract much investment throughout Eastern Europe.
