Publication date: 29 Jul 2021
In August 2020, gambling was legalized again in Ukraine after a 12-year ban. The experience of European countries shows that with smart regulation, the gambling sector brings tangible profits to the budget. What makes the gambling industry in Ukraine so promising?
What laws regulate gambling in Ukraine
Law No. 2285-d “On State Regulation of the Organization and Conduct of Gambling Activities”, which came into force on the 13th of August 2020. The document defines the legal, economic, social and organizational conditions for the functioning of gambling.
Allowed gambling activities in Ukraine are: casinos, online casinos, betting activities in the betting shops and on the Internet, organization and holding of games in arcades, organization and holding of gambling games in poker on the Internet.
- Interesting fact: according to the paragraphs of Article 14, the activities of gambling companies with origin, shareholders or beneficiaries from Russia are not allowed. In addition to that, no gambling equipment produced in Russia can be accepted for use. Compliance with the norms is monitored by the national regulator – a specially created commission. For inaccurate data or mistakes, the operator, most likely, will lose his license. There are no restrictions on other countries in the gambling legislation of Ukraine.
The Law of Ukraine “On Advertising”, Article 22-1 “Advertising of Gambling Games, Gambling Organizers”.
Regulatory authorities of the Ukrainian gambling market
The Gambling and Lotteries Regulation Commission of Ukraine has been in operation since November 2020. The Commission licenses, monitors and controls the activities of market participants. It consists of 7 people, including the head, Ivan Rudny. How to get a gambling license in Ukraine (types, cost, terms, documents)?
Ukrainian Gaming Association (UGA) was established in August 2016. Introduces high standards of quality gaming services for the market of Ukraine, protection of the rights of consumers and operators. The president of UGA is Irina Sergienko.
Ukrainian Gambling Council / UGC under the direction of Anton Kuchukhidze has been working since May 2021. This regulatory body is engaged in improving and optimizing the sphere of gambling business in the country. In particular, UGC develops the Memorandum on advertising of gambling in Ukraine.
Public organization “Ukrainian Gambling Association” (UGA) – an association of experts and consultants to help the state in explaining to the society the positive sides of gambling business legalization in Ukraine. The head of it is Victoria Zakrevskaya.
The National Commission for Regulation in the sphere of Communication and Informatization of Ukraine is searching and blocking illegal online casinos and bookmakers in Ukraine.
Licensing of gambling activity in Ukraine: first results
Hotels in Ukraine have started to actively buy out licenses and organize gambling rooms on their property. As of July 2021, about 20 gambling licenses have been issued in the country. In particular, according to the KRAIL website, documents to open online casinos and poker rooms in Ukraine received Cosmolot, VBET, Parimatch, SlotCity, VulcanCasino, Favbet, Pin Up, SlotKing, Gold Cup, Joker. The only bookmaker’s license is for Parimatch. Choose the best offers from companies looking for traffic from Ukraine!
The amount received by the budget of the country from the sale of licenses – 730 million hryvnia (about $ 26.8 million).
Also, in Ukraine, several b2b licenses were issued for the supply of online casino software. Such a license is valid for 5 years and costs about 1,8 million hryvnia (one-time fee about 66 thousand dollars). The first B2B licenses were issued to Game Reseller, Smart.Technology LLC and Asset Group LLC.
Already in April, 250 gambling sites operated by illegal operators have been blocked in Ukraine. This was done on the basis of a court decision made in criminal proceedings for illegal organization of gambling in the country. According to the National Commission for Regulation of Communications and Informatization of Ukraine, the court has arrested intellectual property rights arising from the Internet users when using the above sites.
What taxes do casinos and players in Ukraine pay?
In July 2021, the majority of Ukrainian legislators supported the bill to amend the main fiscal document of the country, which would entail a tax reduction in the gambling sector.
In the explanatory note to the bill № 2713-d states that the main purpose of the bill is to bring the gambling sector of Ukraine out of the shadows and legalization “by using the stimulating role of taxes”. The introduction of a balanced system, according to the initiators of the document, will allow to increase the inflow of foreign investments and, as a consequence, to raise the number of jobs and revenues to the State Treasury.
For casinos and betting shops in Ukraine in the bill assumes:
- a flat 10% rate on gross gambling income.
- reduction of payment for a license to gambling activity.
- subjects of gambling business continue to pay 18% income tax, but the accrued tax on income from such activities “is the difference and reduces the financial result before taxation of such an entity.
For Ukrainian players:
- taxation of only large winnings from 48 thousand hryvnia – 18% (at the moment – summer 2021 – 18% tax is charged on any amount).
Next, the bill must go through its second reading after revision. This will not happen before September 2021, as the Rada has gone on vacation.
How to work with an audience of players from Ukraine
Ukraine is a European state with the population of about 50 million people. The official language of the state is Ukrainian, it is the native language for about 60% of the population. Until 2012, the second official language was Russian, so even now a lot of people speak it.
According to Wikipedia for 2019, unfortunately, there is no more recent data, 63% of the population of Ukraine are active users of the Internet. Out of them, more than 70% go online from smartphones, and the rest from desktop computers and laptops.
The most popular social networks in Ukraine are Facebook and Instagram. Next in attendance is YouTube. Also, Pinterest and Twitter are popular.
There is Internet censorship in Ukraine. Since 2017, various presidential decrees have blocked access to all Yandex, Mail.ru, Vkontakte, and Odnoklassniki services. Access to WebMoney is also officially banned on the territory of Ukraine. Although the decrees impose a blocking, they do not prohibit Ukrainians from using these sites, which they successfully do through the VPN.
How to attract Ukrainians to the casino and bookmaker sites?
- According to the law of Ukraine, all types of gambling are available only from 21 years old, it is forbidden to involve players younger than that.
- In June 2021 the land-based casino Billionaire, located in Kiev, summed up the results of the first month of work and presented data on visitors. The most popular are slot machines, roulette and card games. Among the visitors are 80% men. It is clear that the data about the offline and online sector can vary greatly, but nevertheless.
- Ukrainians are characterized by “economy” and love of money; they actively react to various bonuses and the possibility of good winnings. Another characteristic feature is stubbornness. If he starts to play – he will play until he wins. Like most players from hot countries, Ukrainians are temperamental and emotional: it is important for them to get adrenaline, to try their luck and excitement.
Since July 2021 the register of excluded players – that is, the list of Ukrainians who won’t be allowed to participate in gambling – officially began to work in Ukraine. Now, legally functioning gambling operators in Ukraine will be required to provide an opportunity for citizens to exclude themselves from the list of their “customers” – this applies to bookmakers, casinos, lotteries and arcades.
Rules of gambling and betting advertising in Ukraine
Gambling advertising in Ukraine must comply with all the requirements of the law “On Advertising”.
At the moment, Ukraine needs precisely defined conditions for gambling and betting advertisements, the existing bans and restrictions are minimal at the moment.
In particular, according to the data of the middle of 2021, Ukrainian legislation doesn’t prohibit in any way gambling advertisements in online environments and doesn’t make any special demands for it. The only requirement is that the brand (company) has a license to operate in Ukraine.
At the same time, advertising of casinos and bookmakers is prohibited on radio and television from 6.00 to 23.00, in all printed media, in most scientific, socio-political, literary and artistic periodicals, on transport and in the subway, on goods and during public events.
However, the law prescribes general rules that are not recommended to be broken also when advertising casinos and bookmakers on the Internet:
- Gambling advertisements must not form the opinion that it is easy to win a game of chance or that gambling can be a source of income or an alternative to work.
- Gambling advertising should be accompanied by the following warning texts: “Taking part in gambling can cause gambling addiction. Stick to the rules (principles) of responsible gaming”.
- Ukrainian gambling advertisements must contain true information and not be false or pretend. Advertising of gambling games must contain information about the license: number, date of its issue and name of the body that issued a license for a certain type of activity in the sphere of organization and holding of gambling games to the advertiser.
- It is prohibited to direct advertising to vulnerable groups: minors, low-income persons, the mentally ill.
The gambling market in Ukraine is still quite young, but it is already very active. Legislative authorization of casinos, poker rooms and betting offices is a huge step towards business development and dynamic budget replenishment. Although the law adopted in 2020 is a bit “raw,” it still needs a lot of adjustments and changes. But all participants in the industry clearly understand the benefits and the need to work in the legal framework. Casino operators began to actively buy licenses for land-based gambling facilities and gambling and betting sites. In order to improve the conditions, the public organizations develop different initiatives, the officials pass the laws – everything for the adequate doing of business. And if you haven’t understood yet – gambling advertising in Ukraine on the Internet is almost unlimited!
Everyone is in the black! Drive on the Ukrainian gambling, and you’ll be in the black too!