Ukraine is a New Legal Market for Investors in the Gambling Field

The draft bill No. 2285-d on the legalisation of the casino industry in Ukraine was revised and adopted On July 14, 2020. Deputies of the Parliament discussed new provisions during several meetings, and more than 3.5 thousand amendments were made to the basic text. According to the voting results, the bill passed, and 248 deputies cast their votes for it.

The 2WinPower team has gathered information on the provisions of law, the cost of the Ukrainian license, and the requirements for applicants. In this article, we will try to get to the bottom of the following question: what prospects will be opened for a new gambling market?

What you Need to Know About the Draft Bill No. 2285-d

Ordinary people and politicians run arguments about the appropriateness of such a law.

Nikolay Spiridonov, an expert at the Ukrainian Institute for Analysis and Management of Policy, has summarized all the pros and cons:

On the one hand, they can say that the budget will be replenished with the help of the gambling sphere. On the other hand, there will always be people who will say that families will lose their money because there may be gamblers among them. So we can say that such an initiative is rather questionable.

The dedicated committee believes that the new industry will give the public treasury up to 4 billion hryvnias already during the first year of its legal existence.

After 11 years of having the ban on any gambling activity, except for the state lottery, in Ukraine, it will be allowed to own:

• land-based casinos;
• land-based betting shops (for any events other than eSports);
• commercial lotteries;
• gambling halls with slot games;
• online casinos;
• bookmaker’s offices on the Internet;
• virtual poker.

The industry will be controlled by the Gambling and Lottery Commission. Its composition will be selected on a competitive basis under the supervision of the Cabinet of Ministers.

To be included in the Commission, people should have:

• impeccable reputation;
• higher legal or economic education;
• work experience of 7 years and 3 of them should be spent holding the executive position;
• fluent Ukrainian.

Powers of the Ukrainian Gambling Regulator

The list includes the following rights and liabilities:

Issuance of Casino Licenses

The Ukrainian commission will issue 11 types of gambling licenses but the operating conditions for them will be prescribed by the Cabinet of Ministers.

A gambling company can receive only one certificate without the right to transfer it to third parties (prohibition on sublicensing).

Registration and Inspection of Equipment

The regulator will create a list of slots, cash registers, and other equipment that is subject to the mandatory certification. Besides, the website will publish information on companies that provide testing and licensing services for the hardware devices for gambling.

Information Registries

In the public domain, it will be possible to find the lists of sanction and trusted organizers. The regulator will also create a register of people who are forbidden to visit gambling locations (the information in it will be private).

Electronic monitoring

For the registration of entrepreneurs who work in the field of gambling, a unified online platform will be developed.

The aim of the service will be to record information on the concluded transactions, prizes that were paid, and the income of license holders. Streaming data will be displayed in real-time.

Provisions for Land-Based Casinos

One of the main requirements of the Cabinet of Ministers is the disposition of gambling zones.

Gambling establishments can only receive visitors in:

• 5-star hotels with 100 or more rooms (for the capital, the minimum hotel room capacity is 150 rooms);
• out-of-town entertainment complexes with an area of ​​10 thousand square meters or more (there should be at least two buildings on the territory of the complex and one of which must be a 5-star hotel).

The casino must ensure the payment of the prize fund within 30 calendar days after the player’s request.

Regulation of the Betting Business

It is possible to organize betting shops in 3—5-star hotel complexes. The number of hotel rooms for the capital starts from 50, and for other settlements — from 25. Bookmakers can also work at race tracks.

Operators can accept bets on any real sports events.

It is prohibited to place bets on:

• the outcome of eSports events;
• games from the category of lotteries;
• events generated by the RNG system.

Legalisation of the business will cost 30 thousand wages. The annual maintenance of the permit in Ukraine will cost 30 wages.

Operators must assure that they will pay winnings no later than 10 days after the end of the event.

Work of Gambling Halls

Platforms with hardware devices should only function in hotels. For Kyiv, these are 3—5-star hotels with 50 or more rooms, for other settlements — hotels with 25 rooms.

It is worth noting that you can organize gambling clubs only in settlements where more than 10 thousand people are registered.

The gross floor area of ​​the gambling hall should be at least 300 square meters. The minimum number of active hardware devices should be 50, and the maximum number of equipment that is allowed by the license — 250.

The maximum repayment period of the prize is 30 days from the date of the player’s request.

The cost of the Ukrainian license gambling halls with slot machines is 7,500 of minimum wages. The annual maintenance will cost 6 minimum wages for each piece of equipment.

Legal Requirements for Online Casinos

Operators can organize any games for money, except for the virtual poker (for this category, a separate license is issued).

The annual value of the permit for an online business is 6,500 of minimum wages.

A document for the legal organization of poker games will cost 5 thousand minimum wages.

The Ukrainian gambling license is valid for 5 years (regardless of the format of work). An exception is free investment certificates that are issued for 10 years for the enterprises that are ready to build new hotel complexes with 150 or more rooms (for the capital of the country — from 200 rooms).

Applicants will not pay for the basic permit but they must pay the established annual fee for each piece of equipment or a gaming table.

Legal Regulations for Investors in the Gambling Field

Compliance regulations for local and foreign operators:

1. Legal status. Applicants should register the company in the country and indicate the organization of gambling entertainment as its main activity.
2. The authorized capital. The size of the fund is from 30 million hryvnias. For its formation, it is forbidden to use credit or budgetary funds, as well as investments, the origin of which does not have documentary confirmation.
3. Certificate of good conduct. Documents are provided by each manager and accountant.
4. Requirements for the accounting department. Those who deal with accounting records must confirm the presence of higher economic education (the bachelor's degree and higher) and relevant work experience of at least 3 years.
5. Enterprise in default. Legal entities previously recognized as bankrupt are not allowed to organize a gambling business.
6. Requirements for foreign operators. Foreign investment from residents of the aggressor country is prohibited.

Responsibility for Violations of Law

The main instrument of control of the industry is financial sanctions. The size of a fine can reach 1 thousand minimum wages.

Registering and consideration of violations will be done by the local regulator. Its decisions may be appealed in court.

Fines may be imposed for:

• admission to gambling for people under 21 years old (2,361,500 hryvnias);
• work with non-certified equipment (4,723,000 hryvnias);
• illegal betting business (755,680 hryvnias).

A separate paragraph is the inaction of law enforcement agencies that have recorded and ignored the violation of law in favour of third parties. For this, they will be subject to criminal prosecution and may be imprisoned for a term of 6—8 years.

The Main Information on the Legalisation of the Ukrainian Gambling Market

On July 14, the draft bill No. 2285-d was adopted, and it legalized all formats of casino games.

The new market is ready to offer:

• licenses for local and foreign investors for 5 years;
• any types of gambling entertainment (there is also no state monopoly on lotteries anymore);
• location of land-based enterprises in large cities (from 10 thousand people) and other settlements;
• a competitive environment for the development of the online sector.

The 2WinPower company comments: deputies of the parliament have voted in favour of the draft bill but so far, it has not been signed by the president. Now is the best time to get ready for the launch of a new gambling startup.

We will deal with all organizational issues and help you to purchase a license in Ukraine and integrate the best game content from the world’s leading manufacturers into your website. We also offer turnkey solutions and services for the development of a turnkey business.

Enter the new gambling market with the professional 2WinPower team! Contact us:

• by e-mail: [email protected]
• on Skype: twowinpower
• in Telegram: @Win2Power
• via the feedback form.