Gambling in Ukraine was illegal between 2009 and 2020. Parliament outlawed gambling business in 2009 after a fire incident in a gambling hall which killed nine people in Dnipropetrovsk. After that Ukraine parliament passed the law on prohibition of gambling business in Ukraine. The president of Ukraine at that time signed the law on June 25 to ban the gambling. The law also applied to internet casinos. It did not apply to lotteries.
Ukraine parliament has legalized the gambling again on 14th July 2020, with some regulations and age restrictions. The minimum age should be 22.
Gaming Zone
Significant provision of the draft law is the creation of so called gaming zones. All gambling activities except for state cash lotteries should move to these gaming zones. The list of gaming zone includes:
- Cultural and entertainment complex, nonresidential premises, Ukraine registered ships that can accommodate a casino with gambling hall of at least 500 sq meters. The territories of the autonomous republic of the Crimea and resort towns located within its boundaries are also proclaimed a special gambling zone.
- Hotels with at least 4 star rating and 100 rooms.
Gambling cannot be opened within less than 500 m proximity of the educational and government institutions and healthcare centers. The main reasons of choosing particular locations were the intentions of the Ukrainian government to:
- To limit the possibilities of the vulnerable part of the population to play games
- Get profit from the EURO 12 that will be held in Ukraine and will inevitably attract many solvent tourists.
To be entering the casino, gamblers will have to comply with the dress code and pass the strict face control.
Who Can Do?
The draft law was developed with the intention of creating a properly regulated gambling market in Ukraine. For this reason the law provides stringent requirements for potential gambling business owners.
- A very serious financial background is one of them. The cost of one time fee for obtaining a gambling license will amount to $5 million.
- The same amount of money gambling business operators should have in the form of registered capital.
- The license will be issued for a term of seven years, so the license fee can be paid in parts within the period of license activity.
- The size of the fee is determined by the Act on Gambling business.
Slot Machine Hall, Land Based Casino and Retail Betting Shops
The commission for the development and regulation of gambling is expected to issue 20 licenses for land based casinos. Casinos will only be allowed to operate in 5 star hotels with 200 rooms (in Kyiv) of 150 rooms in the rest of the country. Gambling area must be at least 500 sq meter. There are over 60 five star hotels in Ukraine.
Slot machine halls will be allowed in hotels with 3 stars or more and with 200 rooms (in Kyiv) or 150 rooms in the rest of the country. The annual fee for slot machine halls is expected to be $1.3 million.
Government is expected to issue 80 retail sports betting shop licenses. License holders will be able to open no more than ten locations. 32 of the licenses are expected to be awarded to retailers in Kyiv, 16 to retailers in Odessa, Kharkov, Dnipro, and Lviv, and 32 in other cities around the country. Betting shop licensees will need to demonstrate a bank guarantee or capital reserves of at least 7200 minimum wages, or $1.3 million.
License Fees
In order to apply for license, operators will have to be in possession of capital reserves or a bank guarantee of $1.3 million. The auction for Kyiv based casino licenses will start at $1.5 million per year. License will be valid for five years.
Requirements
In order to be eligible to apply for gambling license, potential licensees will be required to have a legal address in Ukraine. Companies will have to supply tax, payment, and accounting information, as well as the identities of shareholders and the ultimate beneficiary of the business.
Taxes
A separate bill has been introduced into the Verkhovna Rada to reform the tax code and lower the gambling tax from 18% to 10%.
Online Gambling Businesses
The government is expected to offer 10 licenses to provide digital gambling and betting services. Licensees will be allowed to conduct both sports gambling and casino games.
License Fees
Online casino licenses will be awarded through electronic auction. The bidding is planned to start at $1 million per year.
Requirements
Companies will be required to be registered in Ukraine. They will have to submit an application, a legal address, tax information, payment information, accounting information, information about their shareholders, and information about the ultimate beneficiary of the business.
Operators will be required to provide documents specifying the domain name of the online casino or betting site. The software that operators use will have to be connected to an online monitoring system, operate in accordance with international standards and certifications, and correspond to technical documents.
Taxes
For now, the tax scheme for online gambling business is the same as the one for land based casinos.
Each gambling activity requires the following licenses to be obtained
| Gambling activities | License Fee | Main Requirements |
| Land-based Gaming | 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 table) 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 | 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 | 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 license = 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 licenses will be issued for five-year durations. The Gambling Law also requires gambling operators to obtain supplementary licenses (to be obtained in addition to and for the same duration as the main licenses 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 licenses 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 organization;
- 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 specialized 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 were 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 specialized gambling editions), and bans on outdoor advertising.
