The whole gambling community is fired up by legalization of gambling in Ukraine: it is expected to bring great new opportunities and change the geography of the gaming industry. The Slotegrator team is monitoring the rapidly changing situation and is ready to share all the latest updates with you.
The new authorized body: the Gambling and Lottery Commission
The legalization of gambling in Ukraine is on its way to entering into full effect. A number of active meetings, discussions and agreements led to a change in Ukraine’s legislature; the long-awaited law was signed and legal gaming in Ukraine is finally set to happen. The only missing piece was a special, dedicated body responsible for gambling in the country and assuming all the functions associated with control over the gaming business. The Gambling and Lottery Commission (UGLC) has been formed to fill the role.
The long road to legislation
Ukraine sees the legalization of the gambling business as a positive step when it comes to players’ security, the prevention of unlawful business activities, and the replenishment of the state budget. However, the gambling law did not easily appear — organization of any gambling activities, both online and land-based (except lotteries) was officially banned in 2009; throughout the next decade, there were several attempts to re-regulate the sector, but none were successful until 2020. During that time, licenses were not issued and gaming activities were considered unlawful. But while the ban criminalized the sector, it failed to eliminate it, and a massive black market thrived in the shadows, untaxed and unregulated. Ukraine is a huge market full of hungry players who can now trust they’ll be protected by government regulations — providing a sense of stability that makes the market even more attractive. Now that the law has been signed, the UGLC will be formed and begin the official licensing process.
A quick recap of what has happened so far
The situation is quickly evolving, which makes it difficult to stay updated with every change, but we at Slotegrator are aware of how important it is not to miss a detail — especially for those who are interested in the amazing opportunities presented by the emergence of a huge new market. This is a brief chronology of the development of the Ukrainian gambling law:
What was already done:
- The Verkhovna Rada, the Ukrainian parliament, passed Bill 2285-D on July 14, 2020, legalizing gambling in Ukraine, which had been forbidden for almost 11 years.
- The Gambling Act covers all gambling activities — online and land-based casinos, sports betting, and poker — and makes some amendments to lotteries.
- The law sets a number of requirements for gambling businesses to meet regarding business structure, owners, capital, and operation, including location and space descriptions for land-based casinos and slot machine establishments, requirements for online casinos’ domains, etc.
- The law also determines licensing conditions, fees for each type of gambling operation, and the certification process.
- The law also suggests amendments to the state advertising law to restrict gambling advertising.
- The Gambling Act recognizes the importance of players’ safety and responsible gaming, and describes the measures necessary to comply with these principles.
- President Zelensky signed the bill in August, after some changes in the text of law were made.
- In September 2020, a special team was assembled with the purpose of elaborating a regulatory legislative framework for the creation of the Gambling and Lottery Commission.
What is still expected to be done:
- The Gambling and Lottery Commission will become operational in the near future.
- The state central monitoring system should be created and launched within the next two years. Until it is live, gambling license fees will be high.
- The tax policy is not yet determined, but the proposed taxes should be the subject of a separate act or tax law amendment.
Read an overview of the updates
What is the current state of gambling in Ukraine?
Inevitably, as it often happens, black market activity flourished during the decade-long ban on gambling. Now, with the legalization of the gambling industry, the Ukrainian government has the opportunity to control the sector and ensure safety for local players.
The gambling law aims to strategically solve several problems at the same time: it will promote safe and responsible gaming, collect money for the state budget in the form of license fees and taxes, and enable special bodies to detect and eliminate unlawful activities.
According to President Zelensky, many illegal operations have already been detected, and they will soon start bringing money to the state budget. He believes legalization will raise UAH 5 billion in fees and taxes.
The role of the Commission
The main authority controlling and monitoring gambling activities in Ukraine, the Gambling and Lottery Commission, is expected to be formed and start operating soon, but its main powers and responsibilities are already determined. This is one of the most important steps in the legalization process. We at Slotegrator would like to outline the scope of the Commission.
The Commission will be responsible for:
- Responsible gambling: The Commission will submit law proposals to state authorities and issue normative acts, apply to the court, establish the principles of responsible gambling and requirements for combating pronounced gambling addiction, and approve the description of the player identification card.
- State monitoring system: The Commission willestablish requirements for the system and administer it, develop and approve the relevant procedures, appoint persons to monitor gambling establishments, and approve the procedure for inspecting gambling establishments.
- Licensing and certification: The Commission will develop and propose the licensing conditions for organizing and conducting gambling, maintain the registers, perform the functions of a licensing body for economic gambling activities, decide on the issuance and cancellation of licenses, maintain a list of subjects of certification, and also determine a list of gambling equipment subject to certification.
- Violation control: The Commission will monitor activities, organize and exercise state control over the organization and conduct of gambling, consider complaints from players and other persons about the actions of the organizers of gambling, take measures to prevent and identify violations of gambling legislation, draw up and send orders to eliminate such violations, apply sanctions, and cooperate with law enforcement agencies.
- Industry control: The Commission will collect documents, materials, statistics, and other information from authorities and organizers of gambling, create favorable organizational and economic conditions for attracting investments, ensure equal conditions for economic activity, and cooperate with the relevant regulatory authorities.
What to expect next
The legalization of gambling in Ukraine is an enormous opportunity for all participants — operators, investors, and software, game, and equipment providers, as well as the government and local players, will all benefit from the new situation. But the success of any business operation depends on thorough market analysis. That is why it is so important to stay in the loop — any decision made and act amended can affect future collaborations, investments and projects.
The Ukrainian government’s plans are fairly clear: once the Commission is assembled and fully active, and the tax policy is set, Ukraine will develop a state online monitoring system to keep track of revenues and more easily apply taxes.
Once everything is ready, the Ukrainian market will likely experience a massive boom, which is why today is the best time to begin preparations and start organizing your own gambling business. Your project will need a marketing strategy, license, legal business structure, and high-quality software and games. Though it might seem a bit complicated, it can be done easily with the help of professionals. The Slotegrator team has years of experience and is able to assist you and solve any of your issues quickly to make the most of the rebirth of the Ukrainian market.
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In 2016, I graduated from the Law Faculty of Charles University in Prague. The main area of law on which I focused both during and after my university studies is software law (and intellectual property in general). After graduating from the university, I briefly worked at a medium-sized law firm in Prague, but in 2018 I joined Slotegrator, where I have been working ever since and where I handle the company’s day-to-day legal matters.