On 14 July 2020, the Ukrainian parliament passed a new law, which sets a legal framework for and legalises gambling in Ukraine after its ban in 2009. This article is based on the most recently available text of the Gambling Law, which may be different from the final approved version that will later be published on the parliamentary website.
Gambling activities
The Gambling Law allows the following types of gambling activities to be conducted on Ukrainian territory
- Gaming (land-based and online) – casino gaming including casino table games, offline poker, and others;
- Betting (in betting shops and online) – betting on any kind of real events, like sports competitions and horse races, but not on virtual events;
- Gaming machines (in gaming machine halls);
- Online poker.
The Gambling Law also introduces amendments to the law regulating lotteries in Ukraine, which is a separate specific state-controlled type of gambling activity.
Licences
Each gambling activity requires the following licenses to be obtained:
| Gambling activities | License Fee [4] | Main Requirements[5] |
| Land-based Gaming [1] | EUR 9.2m in Kyiv
EUR 4.6m in other cities |
Only within special gaming zones:
in Kyiv – 5-star hotels with no less than 150 rooms; in other cities – 5-star hotels with no less than 100 rooms; in-country recreation complexes with a minimum area of 10K sq. m.; in special territorial gaming zones established by the government. [6]. Minimum area of casino – 500 sq. m. Minimum number of personnel – 50 employees. Minimum gaming equipment: in cities with over 500K citizens – ten gaming tables (including two roulette tables) and 50 gaming machines; in smaller cities and rural areas – five gaming tables (including one roulette tables) and 20 gaming machines. |
| Online Gaming | EUR 995,000 | Only through web sites with .UA domain name and included into the special register by the Ukrainian regulator and/or through mobile apps. |
| Betting [2] | EUR 4.6m | Land-based - only within special gaming zones:
in Kyiv – 3, 4, 5-star hotels with no less than 50 rooms; in other cities – 3, 4, 5-star hotels with no less than 25 rooms; on the racetracks (for horse betting) Minimum area of betting shop – 50 sq. m. Online – only through web sites with .UA domain name and included into the special register by the Ukrainian regulator and/or through mobile apps. |
| Gaming machines[3] | EUR 1.2m | Only within special gaming zones:
in Kyiv – 3, 4, 5-star hotels with no less than 50 rooms; in other cities – 3, 4, 5-star hotels with no less than 25 rooms Minimum area of slot machine hall – 300 sq. m. Minimum gaming equipment – 50 gaming machines in one gaming machines hall. |
| Online poker | EUR 765,000 | Only through web sites with .UA domain name and included into the special register by the Ukrainian regulator and/or through mobile apps. |
[1] One licence = one casino.
[2] One license allows conducting both land-based and online betting activities.
[3] One license = 250 gaming machines.
[4] Licenses fees are calculated based on the number of statutory minimum salaries; as of today, one statutory salary = UAH 4,723 (or ~ EUR 150).
[5] more specific licensing terms and conditions are to be yet developed and approved by the Government.
[6] not more than five special territorial gaming zones could be established in Ukraine; minimum area of casino – 10K sq. m.; minimum gaming equipment - 20 gaming tables (including 4 roulette tables) and 250 gaming machines.
All the above licences will be issued for five-year durations. The Gambling Law also requires gambling operators to obtain supplementary licences (to be obtained in addition to and for the same duration as the main licences listed in the table above) for:
- each gaming table and/or roulette table – EUR 27,000 annually for each roulette table, and EUR 13,800 annually for each gaming (non-roulette) table;
- each betting shop – EUR 4,600 annually for each shop;
- each gaming machine – EUR 920 annually for each machine.
In addition, the Gambling Law provides the following separate licenses:
- for the provision of gambling services (supply of software directly used in gambling activity) – EUR 46,000 for five years; and
- investment license (issued in relation to an investment land-based gaming project approved by the Ukrainian government) – free of charge for ten years plus supplementary licences under the rates specified above.
Gambling operators
The main requirements for being a gambling operator include:
- must be a legal entity – resident of Ukraine;
- must have charter capital of not less than EUR 970,000;
- must not be directly or indirectly controlled by the persons or citizens of the 'aggressor state' (currently, the Russian Federation);
- must not be a bank, other financial institution, or a non-governmental organisation;
- must have a target deposit or a bank guarantee for the amount of EUR 1.1m.
Gamers and social responsibly
The Gambling Law pays special attention to the safety and protection of gamers from addiction, including establishing a minimum age of 21 years, mandatory identification of gamers, a registry with blacklisted players (e.g. players may irrevocably request to place themselves on a blacklist or be blacklisted at the request of close relatives) and other measures.
Regulator
According to the Gambling Law, the government will form a new specialised gambling authority that will be responsible for state supervision in the gambling area, including issuing licenses, developing by-laws, monitoring and inspections.
State online monitoring system
The Gambling Law provides for the establishment of a central monitoring system that allows the regulator to connect with gaming equipment and monitor all gaming activities in real-time. Such a system has not yet been developed and launched, but is expected to happen under the Gambling Law in two years. Until that time, licence fee amounts (i.e. the annual proportionate amounts) for betting, online gaming, and annual supplementary licence fees for each gaming machine is tripled.
Advertising
The Gambling Law introduces amendments to the Ukrainian advertising law regarding rules and limitations for the advertising of gambling activity, which includes bans on the advertising of gambling on TV, radio, Internet from 6 a.m. to 11 p.m., bans on advertising in any printed media (except for specialised gambling editions), and bans on outdoor advertising.
The Law will come into effect upon its signing and promulgation by the President of Ukraine, which is expected soon.
For more information on this law and the Ukrainian gaming industry, contact your local CMS advisor or local CMS experts: Olga Belyakova and Mykola Heletiy.
Authors:
Olga Belyakova, Partner, olga.belyakova@cms-cmno.com
Mykola Heletiy, Associate, mykola.heletiy@cms-cmno.com
