Rada approves Ukraine gambling bill with no taxation policy 

Voting 248-to-95, Ukraine’s Verkhovna Rada (parliament) has approved the mandate of ‘Bill-2285D – Gambling Law’, passing the legislation to ‘form a new market for regulated gambling’. 

The approval will allow Ukraine’s government to repeal its existing ‘Prohibition of Gambling Law’, which has held a blanket ban on all forms of gambling except state-run lotteries since 2009.

The overhaul of Ukraine’s gambling laws was sanctioned by President Volodymyr Zelensky at the start of his presidency in September 2019 as a core governance and enterprise objective of the SoP Party.

Rada’s approval will see Zelensky maintain SoP’s 2020 legislative agenda, in which the government forced oversight committees to fast-track Bill-2285D for final readings this summer, despite opposition MPs objections that amendments submitted had not been evaluated.

Criticism of SoP’s drafting of Bill-2285D had pointed to flaws on taxation policy, licensing criteria, business transparency and as to how SoP would settle the disputes and demands of influential state lottery operators Patriot, MSL and UNL.

Detailing multiple flaws, opposition MPs lambasted SoP for drafting its frameworks behind closed doors, stating that the legislation would be ‘dead on arrival’ for its final Rada readings.

As it stands, Rada has approved amendments put forward by Ukraine’s Committee on Finance Tax and Customs which will see the country adopt an individual licensing framework for online gambling, land-based casinos and retail bookmakers.

Licences for online gambling have been lowered to UAH 30 million (€1.0m) and will cover a period of five-years.

Meanwhile, retail bookmaker licences have been set at UAH 70 million (€2.3m), with further approvals required from state councils on the number of premises bookmakers will be allowed to operate. 

Land-based casinos maintain the highest licensing cost at UAH 121 million (€4m), in which only 4/5-star hotels will be allowed to operate venues.

The legislation has detailed the criteria for the government department (to be voted on), which will oversee the development of Ukraine’s new Gambling Commission. Furthermore, the legislation also noted all forms of gambling will be restricted to the age of + 21.

Despite approving Bill-2285D, the government has been instructed by Ukraine’s Treasury to hold a separate vote on industry taxation policies, a divisive factor which saw four separate bills submitted to Rada.

Reacting to Bill-2285D, Ukraine media and technology investment group Parimatch Holdings issued the following statement: “The development of a fair and regulated betting industry is excellent news for Ukraine. It shows the world we are ‘open for business’. It will draw international investment into, and help grow, important technology and payments sectors that are the foundation of the betting industry. Through the license fees and tax contributions, it will also generate much-needed revenue for the state budget.

“The Bill includes many best-standard international practices that will form the framework of a transparent and competitive market. We eagerly wait for President Volodymyr Zelenskyi to sign it and deliver on his ambitious pledge to legalize betting to support Ukraine’s new economy. After the Bill is finally ratified, we believe there is a requirement to reform the Tax Code of Ukraine to accompany this regulatory framework; ensuring the long-term viability of the industry in Ukraine.”

SBC continues to track Ukraine developments.

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