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Draft legislation creating a Sri Lankan gambling regulator includes the legalisation of online gambling and the regulation of gambling software development and distribution.
Sri Lankan President Anura Kumara Dissanayake, in his capacity as finance minister, has gazetted a long-awaited bill forming a national gambling regulator with jurisdiction over all gambling segments except lotteries and social gambling.
The draft Gambling Regulating Authority Act 2025, published in the gazette on May 23 and issued on Tuesday (May 27), folds existing commercial gambling segments except lottery under the jurisdiction of the authority (GRA), as well as providing for the regulation of “digital gambling”.
Land-based casino and horseracing legislation would be repealed by the act, and their regulations and licences largely carried over into current legislation.
Most detailed matters of regulation have been delegated to ministerial order, including fees, licence types, advertising restrictions and gaming machine approvals. All such regulations would be gazetted and subject to legislative veto before approval.
The inclusion of digital gambling, defined in the text as inclusive of interactive, internet and mobile gambling, ushers in Sri Lanka as the latest Asian market to dispense with gambling taboos and embrace the segment’s contribution to consolidated revenue.
In this regard, the draft act is explicitly commercial in its intent, with the promotion of “tourism, employment and economic development” rubbing shoulders with standard functions of reducing crime and minimising problem gambling.
However, unlike in the United Arab Emirates (UAE), whose recently created regulator is dominated by foreign nationals on both the board and in executive offices, the board membership of Sri Lanka’s GRA is entirely Sri Lankan, with three of six seats going to ex officio members: the secretary of the finance ministry, the head of the national tax authority and the head of police.
The other three board members, including the chair who enjoys a casting vote, are ordinary appointees. Board members have three-year terms, twice renewable.
The director-general (CEO) of the GRA would be appointed by the finance minister.
Gambling software developers, distributors and operators must be licensed under the act, and developers and distributors are prohibited from releasing products through “unregulated platforms”.
All software must include appropriate pre-commitment tools, warnings on addiction, resources for problem gamblers, as well as containing mechanisms to lock out users who have joined self-exclusion programmes.
Two-year jail terms and penalties of up to 10m rupees ($33,400) apply broadly to offences against the act, including illegal gambling operations, illegal advertising or simply being present at an unlawful gambling facility.
The draft act also awards GRA officers novel powers to “establish and maintain a rating system to assess the performance and compliance of the licensee”, the data from which would be published on the “official website of the Authority”.
The GRA would also enjoy Singapore-style investigative and enforcement powers, with the bill allowing officers to “enter, search, inspect any gambling place or premises or any building in such premises” or access online gambling portals and websites.
Sri Lankan land-based casinos in the capital of Colombo have navigated a semi-regulated environment for decades.
But after years of coronavirus pandemic impacts and economic turmoil, the government moved to create a gambling regulator in mid-2023, with the Cabinet giving the green light to the legislative process in February this year.
