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Ukraine is preparing a blocklist of unlicensed operators and new rules to make it harder for Russian-backed operators to slip into the market, as it continues to root out companies linked to the nation invading its territory.
Ukraine’s Commission for the Regulation of Gambling and Lotteries (KRAIL) has announced that two legislative proposals related to gambling were included in the 2023 legislative work plan of the Verkhovna Rada, the country’s unicameral parliament.
The planned regulatory changes would adapt the licensing process to the country’s wartime conditions and introduce a blocklist of unlicensed gambling operators.
The two draft bills were added to the legislative agenda following a recent meeting of the Verkhovna Rada’s Committee on Finance, Tax and Customs Policy, the Ukrainian regulator said in a statement.
The first draft legislation, entitled “On the Specificity of State Regulation in the Sphere of Organisation and Performance of Gambling and Lottery Games During the Legal Regime of Martial Law”, introduces new regulations related to the wartime operation of gambling.
Among other new powers, it enables KRAIL to suspend the licences of companies whose activities were halted by the armed conflict and renew their licences when the situation allows.
In addition, the bill “prohibits the use of the brands of gambling organisers whose owners are residents of the aggressor state in Ukraine”, referring to Russia, which began an invasion of Ukraine last February.
The second legislative proposal “On Amendments to Certain Laws of Ukraine Regarding the Improvement of Legal Regulation of Activities in the Gambling Market” creates a mechanism that will guide KRAIL’s response to the submission of falsified data by companies applying for gambling licences.
It also introduces new rules for the state authorities with regard to their inspections of gambling outlets.
The draft bill envisages “reducing the list of documents that are required to obtain a licence” to operate in the Ukrainian market, according to the statement.
The Servant of the People party, of Ukraine's President Volodymyr Zelenskyy, holds a majority of 238 of the 450 seats in the country’s parliament, meaning the proposals are likely to be passed by Ukrainian lawmakers next year.
Russia’s offensive against Ukraine has pushed authorities in Kyiv to ban local companies from maintaining any ties with Russia-based individuals and entities.
Despite this, company owners and legal persons with ties to Russia are still present in the Ukrainian gambling market, but the regulator has recently intensified efforts to prevent them from providing services to local customers.
Earlier this month, KRAIL announced that it had decided to scrap the licences of three gambling operators that had been allowed to operate in Ukraine but are “controlled by residents of the Russian Federation”.
The agency cancelled the online casino licence of Joker UA LLC (ТОВ Джокер ЮА), the bookmaking and online casino licences of Play Fan Investment LLC (ТОВ Плей Фан Инвестмент) and the online casino licence of Alphagame LLC (ТОВ Альфагейм).
The regulator said it is cooperating with the Security Service of Ukraine and the National Police of Ukraine to probe existing ties between various Ukraine-based gambling industry players and Russia-based legal persons and individuals. This could lead to further gambling operators losing their licences in the near future.
As of late September 2022, there were eight casinos and 60 slot halls licensed to operate in the Ukrainian market. However, as a result of the war, only five casinos and 39 slot halls were open to Ukrainian players, according to KRAIL figures.
