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Ukrainian gambling: to be, or not to be, that is (already not) the question

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After significant and protracted deliberations, Ukraine finally legalized gambling activities back in 2020. The Law on the governance of the organization and carrying out of gambling activities became effective almost half a year ago. As of the date of writing this article, already 3 licenses have been granted to online casinos for their gambling activities to be performed in the future.

There is still a number of issues and, despite all efforts, the gambling market seems to be standstill except for the mentioned minor movements by local online players obtaining licenses. As of now, it seems that no big international market players are entering the newly born Ukrainian gambling market. So, let`s discuss whether it is all going somewhere and if that somewhere is in the right direction.

 

Ukrainian gambling market background

To see a broader picture, one should unveil the historical background of the current gambling market legalization in Ukraine. First of all, it’s worth mentioning that the Ukrainian gambling market has been actually reopened, but not developed from scratch.

The previously operating Ukrainian gambling market was not so much a success story as one might imagine. There were no huge and fancy casinos like in Las Vegas, but rather a market consisting of different establishments, some of them even legal and compliant. They were shut down by decisive moves of the state authorities in 2009 due to the lack of comprehensive regulations and effective control over their execution, which irreversibly led to negative consequences. As a result, the mentioned flaws contributed to the growth of black and grey gambling services markets. Moreover, the lack of strict rules and their enforcement also formed a public opinion that the gambling market was something antisocial and dirty. Ukrainians still remember well those times when slot machine halls literally surrounded public transport stops and were filled with some not exactly wealthy people giving up their last money in pursuit of a snatch.

At that time, Ukrainian authorities decided to use muscles instead of brains and banned all gambling activities instead of introducing reasonable regulation and taking the situation under control. Thus, starting from mid-2009, all gambling operators were forced to leave the wild, but rapidly growing market. However, as one may guess, the Ukrainian gambling ban was not far from the Prohibition in the United States in terms of its results. Ukrainian gambling market simply went undercover, depriving the Ukrainian budget of significant contributions previously made by the industry.

 

What are the current challenges for the Ukrainian gambling market?

Not so long ago, a logical step was taken by Ukraine and the gambling activities ban was lifted. However, same as in the case with the Ukrainian land market, things are not perfectly smooth and there are still some obstacles in place.

For instance, while three online casinos have already paid for and received licenses, they still can`t fully realize and enjoy the rights of an online casino operator. The reason is that the necessary regulations applicable to certification of the equipment to be used in casinos haven`t been adopted yet. Additionally, there is still a certain lack of clarity in terms of taxation of gambling activities. Some say that a specific volume-based tax will be introduced. However, considering that the licensed operators can`t get any revenues in the absence of the regulations to certify their equipment, the issue of taxation seems to be too far to think about.

Apart from that, one should note that this time Ukrainian government decided to seriously take advantage of the gambling market by imposing comparatively high license fees, financial thresholds, and location requirements (for offline casinos). For instance, the license fee is around USD 1.1 million for online casinos (for 5 years) and USD 10 million for offline casinos if based in Kyiv (additional equipment fees will also apply). Moreover, a gambling operator must have a share capital of at least USD 1.1 million and a deposit account or Ukrainian bank guarantee for USD 1.2 million.

As to the location requirements, under the new legislation, casinos can be opened only at 5-star hotels with at least 150 rooms in Kyiv, 4- and 5-star hotels with at least 100 rooms in other regions, out-of-town resorts with a total area of at least 10,000 m2 or “special gaming zones” within territories to be further defined by the Ukrainian government.

Under the new law, various restrictive regulations of a similar character also apply to betting, slot machine halls, and online poker activities.

 

Opportunities and additional obligations for Ukrainian gambling operators

It is worth mentioning that there are some opportunities for the new market players. The new law provides that such players may obtain investment licenses. Holders of such licenses will be exempt from license fees for 10 years if they build a new 5-star hotel with at least 200 rooms in Kyiv or 150 rooms in another Ukrainian region.

Ukrainian gambling operators will be also obliged to follow certain gambling standards and policies aimed at preventing gambling addiction. The government plans to launch a state-owned online monitoring system. The system will perform a real-time oversight and control of the Ukrainian gambling industry.

To sum it all up, it’s an important aspect that different people might make different conclusions as to the above. Pessimists might claim that this time, the gambling market launch in Ukraine has little chance to become interesting for the largest international market players. However, if evaluated by opportunists, entering the Ukrainian gambling market is definitely worth a shot.

High financial thresholds and strict regulations ensure that the market will not slip into putting dirty slot machines centered around metro stations. It is more likely that the Ukrainian gambling industry will at least somehow resemble what one may observe in wealthy locations like Las Vegas. This puts confidence into the minds of potential investors because the government will not be in a position to cut its own leg by banning a well-governed and budget-supporting industry.

The readiness of the local online casino market players to pay for the licenses which can`t be yet used proves the above statement to be true. It also leads to a conclusion that gambling investors should already be on their way to Ukraine in order to be in a time when the market starts to operate and extreme profits flow into the hands of the few pioneers.

This article has been created with the help of Oleksandr Aleksyeyenko (Partner at Marchenko Partners) and Sviatoslav Henyk (Senior Associate at Marchenko Partners)

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BEGE and EEGS Unveil Visionary 2025 Concept Focusing on Proximity, Collaboration, and AI

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BEGE (Balkan Entertainment and Gaming Expo) and EEGS (Eastern European Gaming Summit) are excited to announce their groundbreaking 2025 concept, which emphasizes the critical importance of proximity, collaboration, and forward-thinking strategies – all while integrating the latest advancements in Artificial Intelligence.

At the heart of this initiative is a strong commitment to fostering meaningful connections within the industry. Together, BEGE and EEGS are creating a vibrant platform for networking and idea exchange, bringing industry leaders together to explore the future of gaming. With multiple networking opportunities throughout the BEGE and EEGS, attendees will have countless chances to engage with one another, share insights, and forge valuable partnerships.

“The power of community is essential to our mission,” says Natalia Baevska, Project Manager of BEGE and EEGS. “By collaborating, we can harness our collective strengths to unlock new opportunities for growth within the region.”

Nino Berezhiani, Marketing Manager, highlights the significance of the initiative’s theme, “Proximity to Potential: Where Every Piece Matters.” She explains, “This slogan captures the essence of our vision. It underscores the idea that every connection and collaboration serves as a vital piece of a larger puzzle, driving innovation and success in our industry. We are excited to create an environment where companies can showcase their achievements, celebrate excellence and engage in meaningful dialogue.”

In addition to the networking events, the initiative will feature an impressive lineup of thought-provoking lectures and lively panel discussions led by industry experts, all designed to spark engagement and collaboration.

Furthermore, the integration of AI into this initiative promises to elevate gaming experiences and enhance operational efficiency, setting a new benchmark for innovation in the sector.

With this ambitious initiative, BEGE and EEGS are poised to transform the gaming landscape in the Balkans, encouraging all stakeholders to come together and actively shape the industry’s future.

The post BEGE and EEGS Unveil Visionary 2025 Concept Focusing on Proximity, Collaboration, and AI appeared first on European Gaming Industry News.

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Compliance Updates

Ukraine Creates New Agency Named “PlayCity” to Control Gambling and Lotteries

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Ukraine has created a new agency named “PlayCity” to control state policy in the field of gambling and lotteries.

The work of “PlayCity” will be coordinated by the Cabinet of Ministers through the Deputy Prime Minister for Innovation, Development of Education, Science and Technology — Minister of Digital Transformation Mykhailo Fedorov.

In 2025, the agency will be financed within the budget of the liquidated Gambling Commission (CRGL).

In December 2024, the parliament decided to liquidate CRGL and transfer gambling regulation functions to the Ministry of Digital Economy. It was decided to automate licenses to remove the human factor from the process and reduce corruption.

The post Ukraine Creates New Agency Named “PlayCity” to Control Gambling and Lotteries appeared first on European Gaming Industry News.

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Eastern Europe

GGBET UA is expanding its presence in football: first press conference with FC Zorya held in Kyiv

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The first media event as part of FC Zorya Luhansk’s partnership with their title sponsor, GGBET UA, has taken place in Kyiv. Zorya is the second Ukrainian football team that the brand has successfully collaborated with. The partnership with the leading betting brand has boosted Zorya’s media activity and brought the club closer to fans.

By working with GGBET UA, Zorya have strengthened their presence on social media, regularly sharing engaging and interactive content. Thanks to this new strategy for interacting with fans, the reach and engagement of certain types of social media posts have doubled. The club have launched an updated version of their official site, where you can now find all the information about their history and current activities. Zorya will also soon be delighting fans by launching an official fan shop.

This approach to the partnership between GGBET UA and FC Zorya Luhansk is bringing the team closer to their fans, creating real value for all involved, and promoting Ukrainian football.

GGBET UA CEO Sergii Mishchenko shared his thoughts about the collaboration and the future of the partnership: “GGBET chooses its partners carefully. Signing football clubs just for the sake of a portfolio is not the approach we take. Shared values, a drive for growth, and a desire to evolve and improve are all important to us. Our partnership with FC Zorya is a brilliant example of our philosophy when it comes to collaboration. We only started working together at the end of 2024, and we’re already seeing results. And we have many new and interesting things to look forward to in the future.”

During the press conference, club representatives also shared the results of their winter training sessions and discussed how the team is preparing for the second half of the Ukrainian Premier League season. The club also announced that it has signed some new players: Bosnia’s Dejan Popara and Ukraine’s Volodymyr Bilotserkovets.

You may recall that previously GGBET UA broadened its support for Ukrainian football by partnering with FC Dynamo Kyiv. A press conference with the club was held in autumn 2024 and was an important step forward in terms of strengthening the brand’s ties with Ukrainian football.

The post GGBET UA is expanding its presence in football: first press conference with FC Zorya held in Kyiv appeared first on European Gaming Industry News.

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