Ukraine Ministers Plan To Liquidate Gaming Commission

May 4, 2023
Ukraine’s government wants to disband the country’s gambling regulator and replace it with a digital system overseen by a single commissioner.


Ukraine’s government wants to disband the country’s gambling regulator and replace it with a digital system overseen by a single commissioner.

The Ministry of Digital Transformation has presented a plan to Ukraine’s parliament to abolish the Commission for the Regulation of Gambling and Lotteries (KRAIL) and create instead an authorised state body which would automate the issuance of gambling licences.

Draft bBill No. 9256 has been registered with parliament and published on the legislative body’s official portal.

In August, the Cabinet of Ministers handed control of gambling to the Ministry of Digital Transformation. The move came amid doubts about the efficiency of KRAIL, the transparency of some operators and completeness of tax payments, leading to the current drive to digitise the process as much as possible.

The existing procedure for issuing gambling licences and making other major decisions of the commission requires a quorum of at least five out of seven members. This rule is often a factor that significantly slows down the process.

The explanatory note to the bill states that "with the introduction of martial law in Ukraine on February 24, 2022, some members of the commission were released from work for the period service during the mobilisation, which resulted in the impossibility of further meetings and the adoption of the necessary decisions to ensure the activities of this body".

Mikhail Fedorov, the deputy prime minister and minister of digital transformation, who is in charge of the reform, wrote on his Telegram channel: "After the support of the deputies, the decision will allow removing the human factor in issuing of the licences — the process will become automatic and will take place according to clear criteria.”

The solution proposed, as detailed in the explanatory note, is “to revise the principles of formation and functioning of the commission, in particular, its transformation from a collegiate body into a central executive body responsible for the formation and implementation of state policy in the field of organising and conducting gambling and lotteries, which requires appropriate legislative changes”.

This means that, for example, the decision on whether to issue a licence would be made only by the head of the new body, and not by a commission of several members elected in an open competition.

The current head of the commission, Ivan Rudy, in comments to the local press, said that the draft had not been officially submitted to the commission and he was able to become acquainted with it only after it was published on the website of Verkhovna Rada, the parliament.

He also noted that it is precisely the group decision-making of the commissioners that creates transparent decision-making and the proposed bill provides for the opposite.

“[The] engagement of seven people is much more difficult than one. Therefore, the transition to a sole form seems to me a more risky story,” he said.

The authors of the bill do not plan to change the terms of licensing. However, it would offer the option of applying for a licence through the state portal of electronic services.

“Also, organisational changes will make it possible to quickly introduce an online monitoring IT system,” Fedorov said of the new bill, “which will help to obtain real-time data on the interaction between gambling operators and the state”.

The current version of the law suggests that the commission should carry out state online monitoring, but according to the draft bill, the new body will only administer the system.

This, as Rudy comments, “involves the transfer of control to a second or third party. Again, the ministry may have partners who have already developed or see a worthy person who will do this.”

The Cabinet of Ministers of Ukraine supported the bill and its future is now up to the deputies of the Verkhovna Rada.

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