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Ukraine’s gambling regulator has been granted additional powers to punish companies with links to Russia.
The Ukrainian government has implemented a decree which empowers the country’s Regulatory Commission on Gambling and Lotteries (KRAIL) to initiate sanctions against Russia-backed gambling companies, amid the nation’s efforts to cut all ties with the Russian economy.
“From now on, the KRAIL, in accordance with the tasks it was assigned, prepares and submits proposals to the Cabinet of Ministers regarding the application, cancellation and introduction of changes to special economic and other restrictive measures (sanctions) introduced by the government for consideration by the National Security and Defence Council in accordance with the Law on Sanctions, and participates in formation, implementation and monitoring of the effectiveness of the state sanctions policy on issues within the competence of the commission,” the regulator said in a statement.
The decree amends the regulations which govern KRAIL’s operations.
It states that the regulator “carries out the preparation and submission of proposals related to the application, cancellation and introduction of changes to special economic and other restrictive measures (sanctions) … to the Cabinet of Ministers of Ukraine”.
KRAIL will also participate in the implementation and monitoring of the effectiveness of sanctions related to the gambling industry, according to the decree.
The regulation was signed by Prime Minister Denys Shmyhal, who is a leading politician from President Volodymyr Zelenskyy’s Servant of the People party.
Russia-backed gambling industry players are banned from obtaining licences to operate in the Ukrainian market, but many of them continue to provide their services illegally to local clients.
In late 2022, KRAIL scrapped 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 agency said that its decision was related to the fact that those operators are “controlled by residents of the Russian Federation”.
In December, the Economic Security Bureau of Ukraine (ESBU) said in a statement that unlicensed gambling operators have revenues of up to UAH12bn (€305m) per month. The resulting losses of the state “can amount to UAH2bn in unpaid taxes” monthly, according to the statement.
The ESBU’s December announcement was related to searches that the agency’s officers and the Security Service of Ukraine (SBU) carried out that month.
The two institutions have launched a probe into the activities of a number of Ukraine-based banks suspected of assisting with illegal gambling operations by “joining a criminal conspiracy” with unlicensed operators, the ESBU said.
Meanwhile, as part of the regulator’s efforts to seize illegally obtained profits from gambling, on February 13, the KRAIL signed a memorandum of understanding with Ukraine’s Asset Recovery and Management Agency (ARMA), an entity responsible for tracking down and seizing assets related to criminal activities.
Among others, the two agencies are to “develop joint positions on solving the most severe and urgent problems in these areas”, the KRAIL said in a statement.
