Is gambling legal in the Kyrgyz market?

After a decade-long prohibition, Kyrgyzstan reauthorized casino operations in 2022, aiming to boost its national budget. However, the gambling industry faces stringent limitations. Land-based casinos must operate only in designated zones, and local residents are banned from playing in casinos.

The government is taking proactive steps to regulate online gambling and establish legal frameworks for the sector. It’s not hard to see why; the Kyrgyz gambling market is expected to reach $113.35 million in revenue by 2025, underscoring the significant potential of the industry and its potential to become an Asian gambling center.

How is the gambling market regulated in Kyrgyzstan?

The primary legislation that governs gambling activities within the Kyrgyz Republic is the “Gambling Activities in the Kyrgyz Republic” law. This law categorizes gambling into two types, casinos and virtual casinos:

• Casinos are businesses that facilitate real-time gambling on the premises of licensed gambling establishments using special gaming machines.
• Electronic (virtual) casinos are gambling platforms that operate through software or websites on the internet. Players do not physically attend these casinos.

The regulation covers a wide range of gambling establishments, including land-based and online casinos in Kyrgyzstan, as well as bookmakers, betting shops, and other related forms of gambling.

Regulatory bodies and their functions

Two key regulators govern gambling in Kyrgyzstan:

• The Gosfinnadzor (Financial Regulation and Supervision Service under the Ministry of Economy) is responsible for issuing licenses and enforcing the laws that regulate land-based Kyrgyzstan casinos.
• The Gosvyaz (Service for Regulation and Supervision of the Communications Industry under the Ministry of Digital Development) is responsible for monitoring the activities of online casinos and other internet platforms.

The regulators’ powers include:

• Licensing of gambling operators and extending the validity of licenses.
• Control over compliance of licensees with the requirements of the legislation.
• Maintaining registers of gambling establishments and online casinos.
• Suspension or revocation of licenses in case of violations.

Although the Kyrgyz government actively regulates land-based casinos, controls remain limited with online gambling. Unlike land-based gambling businesses, which have strict location requirements and cater only to foreign nationals, online casinos operate under less stringent control.

However, as the sector experiences rapid growth and attracts increasing regulatory attention, it is likely that additional licensing and monitoring regulations will be introduced in the future.

Requirements for participants in the gambling market of Kyrgyzstan

In order to obtain a gambling license in Kyrgyzstan, companies must meet a number of requirements established by local legislation. First of all, it is necessary to register a legal entity on the territory of the republic. The founders can be non-residents if Kyrgyz citizens account for at least 10% of the company. Foreign investors who contribute to the development of tourist infrastructure, such as by developing a hotel complex in the designated game zone, are eligible for additional benefits when applying for a license.

Operators are required to utilize certified software and equipment manufactured in 2016 or later. Any modifications of software are strictly prohibited without the regulator's prior authorization. In addition, it is imperative to adhere to the personnel requirements, which stipulate that at least 50% of the workforce must be Kyrgyz citizens, and the minimum age of employees is 23. In addition, a background check of the company's executives is mandatory. They should have no criminal record, higher education, and a total employment history of at least five years.

Each company is responsible for opening an account at a local bank to facilitate financial transactions and establish a reserve fund to cover potential losses. It is critical that the fund be available for each type of game individually.

Land-based casinos are permitted to operate exclusively in hotel complexes that house restaurants with a minimum of 100 seats and hotels with a minimum of 20 rooms. All equipment and specialized software must be certified by an authorized body.

Gambling companies operating online are required to:

• Identify users, record transactions, and protect data.
• Provide the possibility of cashless payments for bets and payouts of winnings.
• Comply with technical software certification requirements

Kyrgyzstan is enacting measures to develop its gambling industry, including the tightening of regulations to protect players and ensure that businesses remain transparent. It’s possible that additional regulations, particularly in the online sector, could be introduced in the future.

The process of obtaining a gambling license in Kyrgyzstan

A gambling license in Kyrgyzstan is issued for a period of 10 years, with the possibility of renewal. The process of obtaining a gambling license in Kyrgyzstan involves several steps and requires the applicant to meet a number of conditions. Applicants must prepare documents, submit an application, and pass an inspection.

Preparation of documents

To successfully obtain a license, it is necessary to collect and submit a package of documents consisting of:

• A duplicate of the certificate of state registration of the company.
• Constituent documents certified by a notary.
• Copies of ownership or lease documents for the software used in the operation of the gambling enterprise.
• A copy of the receipt of the state duty payment when applying for licensing.
• Proof of the existence of a system for identifying users with local citizenship.
• Agreement to keep a register of Kyrgyz citizens’ passports in order to identify clients of the entertainment center.
• Information on sources of income, as well as evidence of their legality.
• Purchase/lease agreement for the land plot on which the entrepreneur plans to build a gaming facility.
• Construction plan and description of related infrastructure.
• Background information on the project founders and chief accountant (passport, citizenship, experience, education, lack of criminal record, etc.).
• Bank certificates on opening commercial accounts and formation of reserve capital.
• Contracts with equipment suppliers, etc.

Submitting an application and obtaining a license

After preparing all necessary documentation, an entrepreneur may submit an application to the regulator and pre-pay the state fee. It is important to note that consideration of the application takes at least one month, although it may extend if the regulator requests additional information.

The license is tied to the establishment's physical address, and the document contains essential data, including the licensing authority's name, company registration details, license validity period, and state registration certificate number.

How much does a gambling license cost in Kyrgyzstan

The cost of a gambling license in Kyrgyzstan depends on the type of gambling activity and the region where the company is registered.

Here’s an overview of the fees:

• Up to $1.1 million - for online casinos, virtual casinos and land-based establishments registered in cities of national importance (e.g., a casino in Bishkek).
• From $500,000 - for casinos in Osh, Chui and Jalal-Abad regions.
• $500,000 - for operators of slot machines.
• $126,000 - for bookmaker offices and totalizators.

According to the Financial Market Regulation and Supervision Service, there are currently five licensed online casinos, three land-based casinos, and two betting companies. There are also 12 lottery operators in Kyrgyzstan, which are owned by the State Lottery Company.

Nuances of gambling taxation in Kyrgyzstan

In Kyrgyzstan, the tax on gambling business operators depends on the activity and the location of the registered company:

• Online casino operators pay a 4% tax on gross gambling revenue (GGR).
• Land-based casinos are subject to a flat tax of 600,000 KGS ($6,850) per gaming table and 15,000 KGS ($170) per slot machine.
• Bookmakers pay 500,000 KGS ($5,700) per betting shop.

In addition, special gambling areas operate under a simplified tax system that includes:

• A state fee of $500,000 for a casino building permit.
• A management patent of $13,300 annually for each casino ($1,800 for betting parlors and totalizators).
• An equipment tax levied on the gaming equipment used.
• 12% VAT levied on every loss on slots, card games, and on the sale of food, beverages and hotel services.
• Pension fund contributions of 10% of employees' salaries and contributions of 17.25% from the company's social fund.

This tax regime is designed to attract foreign investors and stimulate the growth of the gambling in Kyrgyzstan.

How can Slotegrator help?

The Slotegrator team has years of experience in dealing with even the most complex requests. Our range of solutions has everything operators need, from comprehensive online casino and sportsbook platform software to payment method and game integration — check out our APIgrator solution, which enables integration of over 30,000 games from more than 180 providers in one session.

Slotegrator also provides licensing and advisory services and innovative products such as Telegram Casino, which was nominated as the Industry Innovation of the Year by the SBC Awards.

New operators as well as established international brands can enter new jurisdictions with our help, but everything begins with a chat. Get a free consultation and find out more about gambling markets around the world.