California Plans to Legalize Sports Betting [...]
Ukraine’s Gaming Legislation Full of Holes
- December 10, 2015 By Nemanja L. -
While Europe’s leading gaming companies were looking forward to entering the Ukrainian market after the Ministry of Finance submitted a draft of legal framework designed to lift the ban on gambling in the country, they do not appear as keen after finding out the full extend of the plan.
The ban on gambling had been introduced in the former Soviet republic in 2009 by then Prime Minister Yulia Tymoshenko, but the new government has now decided to make casinos, sports betting, lottery and online casinos legal again.
The main reason for this is the fact that the economy is in desperate need of a boost with regards to the huge debt and strained relationship with Russia.
However, while the gaming industry clearly has potential to seriously improve the government budget, it looks as though Ukraine sees gambling as a sort of a get rich quick scheme.
Online License to Cost €1.5 Million
Those operators hoping to be awarded a license need to have offices in Ukraine and must have the capital of €2 million or more, but that is just for starters.
The gaming operators will also be paying between €300,000 and €1 million in annual license fees, depending on the size of the city they operate in.
And if they also want to offer their services via online channels, an additional bill of €1.5 million will be heading their way. The cost of the online license is seven times greater than the same charge in nearby Armenia and Georgia, so no wonder that the gaming companies are far from satisfied with the proposed bill.
The regulations further state that these land-based casinos can only be run in four and five star hotels with 200 rooms or more, and are required to employ at least 250 staff, which creates additional problems and very little room for profit.
Many believe that high licensing fees and high revenue tax will prevent up-and-coming operators from entering the market and at the same time limit much needed competition, so it looks as though the Ministry of Finance will have to think again if they really want to create a fair and regulated gaming market.