The First Fruits of the Adoption of a Gambling Law in Ukraine

by Staff & Contributors

Ukraine is a European country where gambling was considered illegal for a long time: since 2009, both land-based and online gambling has been considered a crime there. In 2020, however, this situation changed completely: with a new law enacted, gambling is now legal in Ukraine. In other words, you no longer have to choose offshore casinos to play the best slots online like the Book of Dead mobile game. You can access the latest and most popular casino games without restrictions. So, what does this new law bring, and how does it regulate gambling? We will answer these questions below but first, let’s take a look at what has been happening so far regarding gambling in Ukraine.

Why Was Gambling Considered a Crime in Ukraine?

Actually, until 2009, Ukraine had fairly liberal regulations on gambling, and there were several land-based casinos in the country. However, in May 2009, a fire broke out in a casino in Dnipropetrovsk city and 9 people died. This fire sparked a public outcry, and the Ukrainian parliament passed a law on May 15 that prohibited gambling entirely. In fact, the main purpose of the law was not to prohibit gambling altogether. It was a temporary restriction imposed until a new law with detailed and strict regulations for gambling was to be published. However, some political and military problems experienced by the country delayed the preparation of this law very much. The temporary ban became permanent in practice. Moreover, it did not end gambling in any way. On the contrary, it caused it to go underground.

The New Gambling Law In Ukraine

On June 14, 2020, President Volodymyr Zelenskyy signed a new law called “On State Regulation of Organizing and Conducting Gambling.” This was the law that should have been published as we mentioned above, but it is a little different from the original draft. The new law included the following regulations:

  • A commission will be set up to issue land-based and online gambling licenses. (This commission is established and known as KRAIL – Regulation of Gambling and Lotteries).
  • Both local and international investors can obtain licenses, but applicants must be a legal entity registered in Ukraine. Also, Russian investors are excluded: Russian citizens and Russian companies cannot obtain a license.
  • Those who apply for a license must have an account with at least 1.2 million USD in one of the Ukrainian banks.
  • Online websites have to use the “dot.ua” domain name.
  • It is forbidden to advertise gambling in TV programs and broadcasts appealing to children. However, outdoor advertising is allowed between 21.00 – 07.00 hours.
  • The license fee is determined as $1.2 million, and gambling licenses must be renewed every 5 years. However, when a program known as “Online Monitoring System” becomes operational in the country within 30 months, the license fee is expected to increase at least three times. It should also be noted that the license fee may decrease or increase depending on the type and location of the gambling service to be offered. For example, if the license only covers online poker, the fee required is much lower.

Two operators have already been licensed: Spaceiks acquired the first online casino license. Parimatch, on the other hand, acquired the first sports betting license in Ukraine. Spaceiks is a local operator and owner of the “Cosmolot” brand, so Ukrainian players know it well. Parimatch, on the other hand, is also a Ukraine-based operator and serves all CIS countries. Founded in 1994, the company has been offering online gambling services since 2000.

These new developments are promising, and we expect other European countries to follow the example of Ukraine in the near future. Licensed gambling is controllable gambling and enables the state to generate revenue. Forbidden gambling is gambling that goes underground and is controlled by illegal entities. The state cannot generate any income and cannot conduct any inspection. Ukraine learned this fact in 2009 when it completely banned gambling. All the gambling activities in the country went underground, causing even the level of crime in the country to rise. Legal and licensed gambling will have the opposite effect. We are confident that Ukraine’s new regulations will produce positive results and benefit everyone.

 

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