The government of Ukraine has prepared a new system of full licensing of gambling companies, as well as new rules for online casinos and online sports betting. The changes were put to a vote in January 2020. Legalization efforts have so far focused on a bill that was passed by Ukraine's ruling Servant of the People party, which has a majority in parliament. According to the project, operators can obtain a single license for both online casinos, such as https://elslotswin.com/, and sports betting, as well as a separate license for land-based and online poker. These licenses can be sold through a public auction to be held by the newly established Ukrainian gambling regulator.
The cost of a casino license in Ukraine
The regulatory body was created by the government of Ukraine as part of the bill. Its creation opened the doors to licensed auctions, which took place as early as February 2020. The initial price of the auction was set at $1 million, while the number of licenses was limited. There were no restrictions preventing international operators from entering the Ukrainian market, but in order to obtain a license, they must create and operate a company registered in Ukraine. The levels of taxation for Internet operators have not yet been agreed.
It is also planned to introduce an annual fee. This will amount to UAH 37.5 million for casinos, UAH 25 million for bookmakers and online casinos, UAH 7.5 million for slot machines and UAH 1.3 million for poker clubs. Why is the license price listed as “from”? Because the license will be sold at a special electronic auction. Therefore, the final license fee may increase during the auction. “The price of the license is quite high and in itself is an effective tool for clearing the market of unscrupulous players, which will be a warning to them about the loss of such expensive licenses.” - said the representatives of the bookmaker Parimatch. How many licenses will be issued? According to the law, the most popular types of gambling will be legalized in Ukraine. Namely - casinos, bookmakers and online casinos, slot machines, lotteries, poker clubs (especially via the Internet).
Offline casino Ukraine
The casino will issue 20 licenses. They can only be present in five-star hotels with 200 rooms (Kyiv) and 150 rooms (other cities). The total number of licenses for betting and gambling in online casinos will be 10, and for betting shops - 80. Since one license allows you to open no more than 10 betting shops, the number of gambling shops in Ukraine will be a maximum of 800. Slot machine halls will receive 160 licenses.
One such license gives the right to install 250 machines. Gaming halls can be located in non-residential parts of hotels with 5, 4 and 3 stars, their area must be at least 300 square meters (in cities with a population of up to 500,000 people) or at least 150 square meters (in settlements with a population of up to 500,000 Human). The territory must not have more than one slot machine per 1,000 people, and their total number in the whole country must not exceed 40,000.
The number of licenses for poker clubs will be 10: five for regular poker clubs and five for online clubs. Lottery operators will also be licensed. Moreover, not even operators, but one operator. This is a company that has experience in the production and conduct of lotteries.
The license will be issued for three years - the company will only organize and distribute state lotteries. This means that the lottery market will be completely monopolized.
Who can get a license?
The organizer of gambling can only be a legal entity with a Ukrainian "residence permit", the amount of the authorized capital of which is fully paid, exclusively in cash and equal to or exceeds the amount of 30 million hryvnia. At the same time, the company must confirm the sources of funds, and its management must have an excellent business reputation (no criminal record). More importantly, the organizers of gambling must have the funds to return the winnings. For this, casinos, for example, must obtain a bank guarantee in the amount of about UAH 30 million (7,200x the minimum wage), slot machines in the amount of UAH 835,000, and a lottery operator in the amount of UAH 417 million.
Unlicensed gambling operators are subject to a double license fee, and their revenues go entirely to the state budget. Market supervision will be carried out by the Commission for the Development and Regulation of Gambling. It is a central executive body with a special status, accountable to the Cabinet of Ministers.
Opinions on the legalization of casinos in Ukraine
Sociological studies show that the majority of the population does not support the legalization of gambling. In addition, it is planned that licenses "will be issued to certain gambling groups that are not very popular among competitors." says the expert. Alexander Khmelevsky also doubts that the legalization of gambling will have a positive impact on the economy. “After the legalization of gambling in Ukraine, there will be more gambling establishments. Legalization will have negative consequences for the Ukrainian economy. Gambling does not create value. In fact, she takes money from people in favor of gambling establishments. Instead of buying goods or services—the kind of purchases that fuel economic growth—the casinos will give them away. The government hopes that due to the legalization of the gambling business, revenues to the budget will increase. In my opinion, this is very doubtful. When people buy goods and services, the state receives VAT, excise duty and income tax. In almost all developed countries, gambling is either banned or heavily restricted.” At the same time, lawyer Ivan Grantsev, managing partner of Grantsev & Partners, believes that regulation of gambling will help strengthen the country's economy. “This is a whole sector of the economy, which is now in the shadows, outside the control of the state. For all the years of its existence, the ban on gambling has only shown its complete absurdity and inefficiency, because gambling has not disappeared after its ban and still exists completely illegally, in the form of underground casinos that are not controlled by the state. The introduction of legal gambling has several advantages: the state will be able to regulate an industry that is currently out of its influence, additional revenue will flow into the state budget, people will have jobs.”
