Gambling Regulation Offers: General Provisions of the Bill Adopted in the First Reading
In January 2020, the Verkhovna Rada adopted the Bill No. 2285-d specifying the ground rules of gambling operations in Ukraine. It was supported by 260 members of Parliament.
The article reveals the general provisions of the draft law in detail.
Types of gambling activities
subject to legalization
The bill stipulates that Ukraine will legalize the following types of gambling business:
- land-based casinos;
- online casinos;
- land-based betting shops;
- online betting shops;
- slot machine halls;
- online poker.
Only legal entities are allowed to establish gambling venues and run gambling businesses. The company’s charter capital should be at least 30 million UAH.
To establish a casino, a betting shop, or any other venue on legal grounds, you should obtain a corresponding approval document. Besides, each kind of gambling activity requires a separate license valid for five years. There are also additional licenses for gambling tables and slot machines.
The role of a regulatory body
and an online monitoring system?
The legal document approved by MPs stresses that the Committee on the development and regulation of gambling will serve as an authorized body. It should consist of seven people: the head and six members.
The regulator will have the following obligations: development of licensing terms, imposition of sanctions against gambling market players, creation of favorable conditions for investment raising in the gambling sector, licensing decision-making, consideration of gamblers’ complaints, determination of requirements to organizations engaged in gambling equipment certification, etc.
The draft law also implies the establishment of an online monitoring system in Ukraine. One offers to integrate all gambling devices with it. Equipment failing to complete this procedure is prohibited.
The online system should be certified in a corresponding Ukrainian and/or foreign laboratory. It is expected to control operations of gambling market insiders.
General requirements for
gambling business organization
The draft law specifies that games of chance are allowed only to persons aged 21 and older. At the same time, physical entities can voluntarily limit their participation in gambling entertainment for six months to three years. To exercise this right, players should provide the regulator with a written application.
Operators will be obliged to comply with the responsible gambling principles in order to prevent gaming addiction. They will have to identify all visitors and inform gamblers of anti-problem gambling organizations and facilities.
It is prescribed that the verification procedure should be conducted during the first visit. The second identification can be based on the player’s card. Online identification of gamblers is suggested to rely on a copy of the identity document or e-signature, BankID, and other means.
Moreover, the bill supposes the introduction of a ban on slot machines released earlier than 2019.
Where to establish casinos?
According to the bill, land-based casinos will be allowed in the territory of five-star hotels. Kyiv-based facilities will be able to operate in hotels with at least 150 rooms. 100+ rooms are required in other cities.
The legal document states that this rule is not applicable to investment projects. In this scenario, casino games are based on an investment license. Such a document is issued in case of building a hotel with 200 or more rooms in Kyiv and hotels with 150+ rooms in other cities. The permit is free and valid within 10 years.
The draft law sets out the requirements for the number of gambling tables and the minimum amount of personnel. Participation in games of chance should be performed using tokens of chips equipped with trackers.
How will betting operations
The bill holds that land-based betting shops will be allowed within the following facilities:
- Kyiv – three-, four-, and five-star hotels consisting of 50+ rooms.
- Other Ukrainian cities – hotels of the same categories but with 25 and more rooms.
Betting shops are permitted in the territory of at least 50 sq. m.
for slot machine halls
The draft law mentions that slot machine halls could be placed as follows:
- Kyiv – three-, four-, and five-star hotels consisting of 50+ rooms;
- Other cities – hotels of the same categories with 25 and more rooms.
The total area of one or several premises for a slot machine hall should be not less than 300 sq. m. in Kyiv and 150+ sq. m. in other cities.
The number of slot machines that can be installed in the venue depends on the population of each city. In particular, one slot machine should account for 1000 people. By the way, Ukraine allows 40,000 machines of this kind in total.
Reportedly, a holder of one license will be able to use no more than 25 slots. Furthermore, one legal entity will be able to obtain no more than 35% of the total amount of license certificates for establishing slot machine halls.
Lottery and poker organization:
The bill stipulates that only state lotteries will be allowed in Ukraine. Operators should have a bank guarantee or a deposit amounting to 100,000+ minimum wages.
Permitted types of this gambling activity include instant, draw, and combined lotteries. There will be a ban on the distribution of lotteries having attributes of casino and slot games using terminals.
Poker games will be conducted via an online system, particularly using a website or mobile apps.
To hold offline poker tournaments, you will have to get a permit by the authorized body. It is supposed to be free of charge. One tournament can last no more than 14 days. A business owner will be allowed to carry out a single competition in six months. Official poker world championships are considered to be an exception.
Cost of gambling licenses
The bill specifies the cost of all gambling licenses and their payment due dates.
A license document on gambling business operations costs:
- 60,000 minimum wages for casinos located in Kyiv-based five-star hotels with 200+ rooms;
- 120,000 minimum wages for casinos accommodated in Kyiv-based hotels with up to 200 rooms;
- 30,000 minimum wages for casinos in other cities (save for Kyiv) that will operate at hotels with over 150 rooms;
- 60,000 minimum wages for casinos hosting 100-150 rooms if they function beyond Kyiv;
- 12,500 minimum wages for launching an online casino;
- 120,000 minimum wages for betting operations;
- 80 minimum wages for land-based betting shops;
- 750 minimum wages for slot machine halls (a common fee for a license; a one-time payment for the right to get it is determined by the e-action results);
- 2500 minimum wages for online poker;
- at least 76,000 minimum wages for lottery holding (the ultimate sum should be defined according to the e-action outcome);
- 300 minimum wages for providing gambling services.
Gambling equipment fees:
- 350 minimum wages for each roulette table;
- 175 minimum wages for each table designed for other games of chance;
- 12 minimum wages for each slot machine installed in a casino;
- 6 minimum wages for a slot machine located in slot machine halls.
Liability for law violation
According to the bill, gambling business owners can be fined in case of breaking its provisions. The sum of the penalty depends on the type of violation:
- 1000 minimum wages for changing or upgrading the construction of gambling equipment;
- 500 minimum wages for letting individuals under 21 years of age in a gambling venue;
- 500 minimum wages for ignoring the rules of gamblers’ identification resulting in access of persons under 21 years of age to games;
- 1000 minimum wages for accepting bets using uncertified equipment and machines not connected to the online monitoring system or non-tested.
The third session of the Ukrainian Parliament of the ninth convocation started on February 4, 2020, and last until July 17. MPs are expected to keep working on the bill during this period.
Gambling legislation features will be thoroughly discussed at Ukrainian Gaming Week. The event will take place on April 15-16 and bring together manufacturers and providers of gambling services as well as Ukrainian lawmakers and international experts.