Gambling and sports betting business in Eastern Europe and the CIS in 2024
Eastern Europe holds the potential for both success and frustration. While some countries have liberal regulations and newly re-regulated markets, others exploit the gambling industry with skyrocketing taxes, constrain it with tight restrictions, or ban gambling and betting outright. Keep reading for a rundown of which markets to keep an eye on in 2024.
Eastern Europe is — and always has been — a region of great risks. Regulations change, laws are passed and repealed, and as one country lifts restrictions, another introduces them. But plenty of operators have found success in the region, and it will continue to offer savvy gambling providers opportunities to grow and prosper.
To help you keep up with the times, we’ll talk about the industry's history in the region and the current situation in several Eastern European countries.
Different sources provide different views on geographical division, this is especially true in Eastern Europe. There are different perspectives we address this topic in the iGaming:
Geographically Eastern Europe includes Belarus, Russia, Ukraine, Moldova, and Romania. Some definitions may also include the Balkans (Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Kosovo, Montenegro, North Macedonia, Romania, Serbia, and Slovenia), the Baltic states (Estonia, Latvia, and Lithuania), the Caucasus (Georgia, Armenia, and Azerbaijan and small portions of Russia, Iran, and Turkey), and the Visegrád group (Poland, the Czech Republic, Slovakia, and Hungary).
The list of Central and Eastern European countries includes Albania, Bulgaria, Croatia, the Czech Republic, Hungary, Poland, Romania, the Slovak Republic, Slovenia, and the three Baltic States (Estonia, Latvia, and Lithuania).
We covered Central European countries — Hungary, Poland, Slovakia, and the Czech Republic — in this article, read it to find out more about gambling in Europe.
The information about Balkan countries can be found here. And if you click here, you can read about the Nordics and the Baltics.
There is also a term for CIS (the Commonwealth of Independent States).
What about the CIS?
The term CIS refers to the Commonwealth of Independent States, a regional organization formed after the dissolution of the Soviet Union in 1991. The CIS was established to help former Soviet republics coordinate their policies in areas like trade, finance, lawmaking, and security.
The CIS member countries include:
- Russia
- Belarus
- Moldova
- Kazakhstan
- Kyrgyzstan
- Tajikistan
- Azerbaijan
- Uzbekistan
- Turkmenistan
- Armenia
The alliance technically still exists, however referring to “gambling in the CIS countries” as the post-Soviet area in general is inaccurate — the list includes only 10 countries. On the other hand, “gambling in the CIS” and “gambling in Eastern Europe” are also not identical concepts, since the CIS consists of both European and Asian countries.
At this point, it makes more sense to group gambling market overviews geographically. We will help you with navigation, so you can easily find the information you need.
To find information about gambling in Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, and Armenia, please read our article on gambling in Asia.
Gambling in Europe is divided into several articles, this article will cover online casino business in Eastern Europe.
Gambling in Eastern Europe
The Russian online gambling market
The history of the Russian online gambling market is full of twists. At the beginning of the 2000s, gambling was completely unrestricted. Slot machines could be found in gambling halls, casinos, public spaces, and convenience stores. The industry’s unfettered operation at the time gave it a poor reputation in the eyes of the public.
Early attempts at regulation were not successful. Initiative to make all gambling enterprises partially state-owned so that proceeds from the industry could be used for public needs in the 1990s failed — operators reported no earnings. One of the authors of this unsuccessful initiative was Vladimir Putin, who in 1999 became Acting President of the Russian Federation.
Expectedly, the head of state with a record of criticizing gambling cracked down on the industry, and by 2009 most games of chance were outlawed. Land-based casinos were permitted only in specially designated gambling zones: Azov-city in Krasnodar Krai, Altai, Kaliningrad, and the Far East.
The casino business in Russia, which was booming at the beginning of the 2000s, dwindled as the blanket ban came into force. While demand was huge, gamblers were not interested in traveling to out-of-the-way regions. The zones were remote and had little to no tourism infrastructure, so for a vast majority of players, it was simpler to travel to a neighboring country or content themselves with the less-glamorous offerings of black market casinos.
Ultimately, most of the designated zones underperformed. Azov-city, the first gambling zone to open, was liquidated in 2018, costing investors 3.3 billion rubles. Neither Altai nor Kaliningrad has ever shown spectacular results.
The Primorsky zone, located in the Far East and owned by a Taiwanese company, prospered by attracting tourists from South Korea and China instead of focusing on local gamblers.
A new zone (to replace Azov-city) was opened near Sochi to take advantage of the infrastructure that was created for the 2014 Sochi Winter Olympics. However, the zones proved to be frustrating for investors and less lucrative than the government anticipated.
Needless to say, the worldwide shift from land-based to online gambling — which has been accelerating in the last couple of years — wasn’t felt in the country, as online casinos in Russia are completely illegal.
Nevertheless, there is a workaround for those who want to play online. By using VPN, users can redirect their web traffic from their device to a server located outside of Russia. VPNs allow people to securely and privately enjoy an online casino or sportsbook without the risk of being monitored.
Previously, the sports betting business in Russia was largely untouched. Bookmakers and operators of parimutuel betting could be licensed and work legally in the country, even outside of the gambling zones.
However, when the 2020 crisis hit the Russian sports industry, new regulations aimed to support it by utilizing the betting industry.
Bill № 1055657-7, “On Unified Gambling Regulator,” was introduced in November, swiftly passed into law in December, and signed by the president on December 30th.
The new legislation aimed to introduce a single regulator for the gambling industry, unified systems for payment, and online monitoring, as well as a new way to calculate compulsory contributions that betting companies pay to sports organizations.
Of course, the law received its fair share of criticism for being full of terms and measures that were not particularly well-defined. At the same time, it marks a novel direction for Russian legislation because, to an extent, it’s inspired by Western regulations and aims to centralize and streamline the industry.
This trend was also supported by Decree No 706, which came into force in January 2021. This measure removes numerous outdated restrictions and requirements, making the Russian online casinos and land-based gambling landscape a little easier for operators to navigate.
New regulations governing the gambling business will come into effect on September 1, 2024. These changes aim to tighten control of the industry, particularly the online segment, addressing online gambling platforms, mobile betting applications, and other digital gambling services. By implementing stricter oversight and control measures, the government aims to prevent illegal gambling operations and promote responsible gambling practices.
Gambling in Belarus
For a while, the gambling market of Belarus prospered by catering to players from neighboring countries where gambling was illegal. However, in recent years, growth has subsided.
Even before the crisis, the industry was already in decline. The number of casinos, bookmakers, and slot-machine halls had been decreasing, year by year. Meanwhile, the government was reporting increased earnings from the gambling industry, thanks to ever-rising taxes.
2020 was a rocky year for the country. After the crisis started, both, the land-based sector and sportsbook and casino sites in Belarus suffered even more, even though the Belarusian government didn’t impose strict lockdowns. Protests that erupted in August were also extremely detrimental to the industry; the economy suffered, mobile internet connections were disrupted, and the public was too preoccupied to focus on entertainment.
In the past, gambling was regulated by presidential decrees. In 2023, however, gambling regulations were codified into law, creating a general licensing framework. The potential implications of these changes remain uncertain, as licensing conditions are stringent in both the old and new systems.
If the government’s attitude changes and the situation in the country stabilizes, the market might start growing again, but at this moment it’s too early to anticipate any changes.
Gambling in Ukraine
In 2009, all forms of gambling in Ukraine were banned, but the market recently opened back up. After 11 years, gambling was legalized again in the summer of 2020, kindling considerable interest among local and foreign investors.
The new legislation allowed for online and land-based casinos, betting shops, gaming halls, and poker rooms. Licensing requirements and fees are different for each type of business; in the case of land-based gambling establishments, they depend on geographical location.
In 2022, during the early stages of the war, authorities changed the law to allow certain business sectors, including gambling, to enjoy a reduced 2% tax rate on their profits. As a result, almost all gambling operators quickly adopted this simpler tax system. However, in 2023, authorities proposed axing the perk, as tax contributions to the budget fell short of expectations.
The new regulations are finding themselves under critical fire. The variety of fees and taxes that operators are responsible for, as well as some of the highest licensing costs in Europe, could make operations in Ukraine financially untenable, jeopardizing the benefits of legalization. In iGaming, there’s always a risk that stringent regulations and licensing conditions can drive operators into the unregulated market, taking players (and tax revenues) with them.
However, overall, as one of the many promising regions for the gambling business, it is definitely a good idea for prospective operators and investors to closely monitor the situation in the country.
Despite the challenging circumstances the country is facing, the gambling industry in Ukraine still shows potential for growth and success. We will continue monitoring the situation in Ukraine closely and provide updates accordingly.
Moldova
Moldova’s gambling industry is regulated and has undergone significant changes in recent years to tighten control and increase state oversight.
The gambling sector in Moldova is regulated under the Law on the Organization and Conduct of Gambling, which has been updated multiple times, most notably in 2016. The Public Property Agency, under the Ministry of Economy and Infrastructure, is the main authority responsible for overseeing gambling activities.
The regulatory landscape shifted significantly with the government taking a more centralized approach to control the industry. The government of Moldova has imposed strict licensing requirements, giving the state significant control over the gambling industry.
Since 2017, the law has designated a state monopoly for certain gambling activities. The law regulates several gambling activities, including casinos, lottery, gaming rooms with machines, sports betting, and online gambling through electronic communication networks. It is all managed by the National Lottery of Moldova. Due to the monopoly-like control, private operators face limited opportunities.
You can find out more about gambling regulations around the world with our interactive map.
What’s next?
Industry operators and experts agree on one thing: having one’s ear to the ground is extremely important. The Eastern European market is highly dynamic and subject to sometimes unpredictable changes.
Each country has its legal system and numerous political and economic factors in play that can influence the gambling market in one way or the other. Laws are written or repealed and economies boom and bust, but every year, opportunities open up, and those who follow the changes (or even anticipate them) can expect growth — and a payday.
We also monitor and continuously update information regarding gambling regulations in Central Europe, the Nordics and the Baltics, Asia, and the Balkans.
Slotegrator works with companies all over the globe and we are happy to share our extensive experience with both those who are new to the market and seasoned operators looking to expand. Click the button below for a free consultation.
