Georgia Approves Tough New Gambling Restrictions

January 4, 2022
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The Eastern European nation of Georgia has introduced stringent new rules across its gambling sector, including an advertising prohibition and new taxes for online casino players.

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The Eastern European nation of Georgia has introduced stringent new rules across its gambling sector, including an advertising prohibition and new taxes for online casino players.

In the last days of 2021, the Georgian parliament gave final approval to a set of legal amendments that their instigator, Prime Minister Irakli Garibashvili, claims will limit the negative effects of gambling in the country.

New regulations include harsh advertisement restrictions, raising the legal age for gambling, introducing an exclusion list, restricting banks from making payments to foreign gambling operators and reworking lottery taxes.

Parliamentarians acted unusually swiftly to pass Garibashvili’s proposals, which he said will address the growing rates of problem gambling among younger people in Georgia.

Previously announced plans to raise taxes for online gambling operators were not approved, although a new tax for players was introduced.

The most sweeping changes are to marketing, meaning that from March 1 any casino or sportsbook advertisement on TV, radio, outdoors and on the internet becomes illegal almost everywhere in Georgia.

Exceptions include international airports and border customs checkpoints, where casino ads will be allowed.

Also excepted are operator’s own websites, although it is unclear from the wording of the law whether land-based casinos are allowed to advertise through their own online presence.

Casino and sportsbook marketing will also be allowed at sports events and as part of team sponsorship contacts.

Any approved outdoor signage should be limited to a maximum of ten square metres, according to the law. Land-based venues are allowed to have additional promotional material on their own premises in the form of an additional ten square metres of ad space.

The legal age of gambling for Georgian citizens has been increased to 25 for all forms of gambling, although foreign tourists will be allowed to enter casinos from the age of 18.

This actually amounts to a decrease in the legal age for casinos for international visitors, down from 21 years-old under the old regime.

The amendments also introduce a government-run player exclusion list which every gambling operator must refer to, both land-based and online.

Secondary legislation is needed to lay out the details of the system, but officials have said it will include all civil servants, citizens receiving government assistance and persons determined by a court decision to be addicted to gambling.

The Law "On Payment System and Payment Services" has also been amended to include articles prohibiting Georgian payment service providers from taking payments from any foreign casino or sportsbook company.

Starting from January 1, lottery organisers are now obliged to pay the Georgian Treasury a fee equal to 10 percent of the difference between the total cost of the lottery tickets sold and the prize fund.

Other changes to tax law state that “the taxable income received from the system-electronic form of gambling (the definition used in the local law to represent online gambling) by a natural person is taxed at 10 percent”.

A further 2 percent is payable on the amount withdrawn from an online account.

Although it is likely these new rates apply just to online casino gambling, lawyers in Georgia say the exact purview of the new rules has yet to be completely clarified by the government.

Amendments have also shortened the reporting period for online casino operators to one calendar month.

Sources indicate that online operators lobbied the government to delay implementation of the changes until the autumn, but their requests were dismissed.

Having been signed into law by President Salome Zurabishvili, most of the new rules will come into effect from March 1, with the exception of the lottery and player tax changes, which took effect from January 1.

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