Parimatch Among Ukrainian Companies Shuttered Over Russia Links

March 14, 2023
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Ukraine has named a slew of gambling companies that must shut down over alleged links to Russia, including leading bookmaker Parimatch, which has previously pledged to channel profits directly to the Ukrainian army.

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Ukraine has named a slew of gambling companies that must shut down over alleged links to Russia, including leading bookmaker Parimatch, which has previously pledged to channel profits directly to the Ukrainian army.

Ukraine on Friday (March 10) imposed sanctions lasting 50 years against a number of gambling companies, mainly betting and lottery firms, allegedly associated with Russia.

The list includes 287 legal entities and 120 individuals. According to the press service of the President of Ukraine, corresponding Decree No. 145/2023 was signed by Volodymyr Zelensky.

The list of sanctioned companies related to gambling mainly includes bookmakers, including 1xBet, 1xStavka, Fonbet, Marathon, Liga Stavok, Winline, Sportbet, Betcity, Matchbet, Bookmaker's office "Pari", BC Olympus and others. The Russian operator of state lotteries Sportloto is also subject to sanctions.

The list of sanctions also includes businesspeople from Russia, Great Britain, Cyprus, Turkey, the Netherlands, Poland and Armenia.

But it is the surprise inclusion on the sanctions list of the largest Ukrainian sports-betting company, Parimatch, that has generated the biggest shockwaves.

The company previously had operations in Russia, but since the beginning of the war it claimed to have ceased business there and banned the use of its brand and technology in the country.

A Kyiv-based Parimatch partner company that represents the brand internationally, PMI, claimed the bookmaker had been targeted unfairly.

“Taking all this into account, PMI refuses to understand how our partner, Parimatch Ukraine — a company founded in Ukraine, an exemplary taxpayer, and a major donor of the Armed Forces of Ukraine — could be included in the sanctioned companies list. Parimatch Ukraine asked for clarification from the government," said PMI in a statement on LinkedIn.

The statement added that the company had taken legal advice from law firm Mayer Brown that confirmed it was in compliance with Ukrainian law.

Parimatch reportedly published its own statement on its website, but the site has since been taken offline.

In March 2021, the company received licences for betting and online casinos in Ukraine, paying more than UAH850m ($23m) in taxes, fees and royalties to the state budget of Ukraine during the last two years.

In 2023, tax and licence payments by Parimatch LLC amounted to UAH485m ($13m).

In 2019, the company established an international charitable foundation “to support sustainable long-term initiatives and projects in the territory of the company”, as stated on the website of the organisation.

Since the beginning of the war, Parimatch Foundation claims it has been actively helping Ukraine and its citizens to withstand Russian aggression. The total amount of charitable donations it has generated in Ukraine is more than UAH500m ($13.5m), says the company.

In March 2022, the company was praised by Ukraine’s gambling regulator for quickly cutting ties with Russia after the war began.

Parimatch also promised at the time to provide money for “binoculars, body armour, drones, helmets, military spec, thermal imagers and night vision devices” for the Ukrainian army.

Nonetheless, accusations of continued connections to Russia have dogged the company in recent months.

Parimatch claims that individual employees of the security services of Ukraine have been putting pressure on the company.

It says the work of payment systems was regularly blocked, actions were taken to initiate criminal cases, what the company terms manipulative and unreliable information was repeatedly disseminated on social networks and in the media, and attempts were made to include connected holding companies on the sanctions lists.

On Monday (March 13), Parimatch issued a message in which it confirmed that the company's Ukrainian operations have been terminated, its platform is unavailable for customers and the pm.ua website is blocked.

Natali Gilevych, the CEO of Parimatch.UA, posted on Facebook that the company is following the President’s order and has ceased all operations in Ukraine.

Gilevych said Parimatch will refund customers’ deposits after they find a legal way to do so.

She also noted that all partnership contracts are now suspended and employment contracts are cancelled.

“We understand that stopping all of the company’s operational processes won’t allow us to fulfil our obligations to the team,” she said.

According to the UK’s Daily Mail newsletter, football clubs including Chelsea are “reviewing” their contracts with Parimatch.

Data firm Sportradar, which contracts with a large number of international sports leagues and clubs, is also named on the sanctions list, according to the Daily Mail.

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