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Ukraine Blocks Offshore Casino Platforms Operating From Russia

Tiffany Burroughs
Updated: 23 June 2023
2 min to read

On Monday, President of Ukraine Volodymyr Zelensky declared that Ukrainian troops would not pull away from Bakhmut, a city in Eastern Ukraine that has been at the center of a prolonged battle with Russian forces. This week, Ukraine further took action to ensure that companies from Russia would not be able to access the country digitally.
Ukraine offshore iGaming casino website Russia

In war-battered Ukraine, a man was caught carrying a young girl on his shoulders. Recently, Ukraine began to crack down on the offshore gambling networks that targeted local gamblers. To prevent people from accessing these illegal websites, Ukraine’s Security Service and its Gambling Council have been effective in blocking them. In response to this, president Volodymyr Zelensky lifted the ban on brick-and-mortar casinos in 2020 and soon after, the Billionaire’s Casino in Kyiv opened, located within the InterContinental Hotel. This luxury gaming room offers around 50 slot machines and 16 table games, but visitors must be at least 22 years old to enter and gamble.

Since the outbreak of the COVID-19 pandemic and the beginning of Russia’s invasion of Ukraine last year, any plans for increased gambling opportunities have been put on hold. Ukrainian President Volodymyr Zelensky ordered a ban on all forms of in-person gambling, including in poker clubs, and this suspension has continued indefinitely. This is known as the iGaming Purge.

iGaming Purge

In 2020, Ukraine President Zelensky enacted a law which legalized gambling online. This law requires any iGaming operators wishing to acquire an internet gambling and betting license to be approved by the Ukrainian Commission for the Regulation of Gambling and Lotteries first. Furthermore, these entities must not be owned or controlled by a Russian company or citizen, or even own shares of any kind of Russian company with significant shareholders located in a jurisdiction from the Group of Seven’s Financial Action Task Force black or grey lists. Such countries usually include North Korea, Iran, and the United Arab Emirates. After an applicant’s online operations show compliance through requisite testing, the agrement of a one-time payment of about $1.3 million for an iGaming license is then put in place. Finally, gross gaming revenues collected by online casinos are subject to an 18% tax.

Since 2020, despite Ukraine having a regulated online gaming industry, officials have reported that rogue offshore sites are still targeting the country, mostly operating from Russia. This has caused a need for better protection of the legal market.

Protecting Legal Market

The Ukrainian Gambling & Betting Association has stated that Ukraine’s attack on illegitimate offshore gaming websites in order to ensure that land-based casinos and legal iGaming platforms are not negatively affected by illegal alternatives, is not helping their members. The announcement from Ukraine’s Cabinet of Ministers also said that tax payments and other financial obligations would not be delayed, which was something the Association had requested. Mykola Melnyk, a spokesperson for the Association, commented that those who have already invested in the legal land segment have yet to recoup their investment and that the changes as enforced by the Cabinet of Ministers are making it more difficult to bring investments to the Ukrainian market.

More than 42,000 people have died and approximately 15,000 are missing as a result of Russia’s invasion of Ukraine. In addition, the war has caused damage with an estimated value of over $350 billion.

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Updated: 23 June 2023
2 min to read

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