In Ukraine on August 11, 2020, Bill 2285-D was passed in the Verkohvna Rada parliament, emerging victorious after a commanding 248 to 95 vote. This bill, signed by Ukrainian president Volodymyr Zelensky, makes gambling legal in the Eastern European nation — something that is providing huge opportunities, both within and outside of the country.
Under the provisions of the bill, sports betting providers, land-based casinos, and digital casinos are able to operate in the country. In order to be permitted to do so, these firms need to apply for licenses and pay the appropriate fees.
These fees are not insignificant. Ukraine’s Committee on Finance, Tax and Customs Policy (CFTCP) has approved fees of UAH 70.8 million (US$2.5 million) for sports gambling providers, UAH 30.7 million ($1.1 million) for online gambling firms, UAH 23.7 million ($0.87 million) for online poker providers, while land-based casinos will pay either 121.6 million ($4.44) or 70.8 million ($2.5 million) depending on whether or not they are based in the capital Kyiv.
Some critics, including Parimatch CEO Sergey Portnov, have warned that taxation could put pressure on the betting market, but most have welcomed the changes to Ukrainian law.
One Year On: A Growing Industry in a Growing Market
A year on from the passing of the bill, and Ukraine is now experiencing significant revenue increases due to legalized and regulated gambling. What’s more, gambling service providers are waking up to the possibilities offered by Eastern European markets.
By and large, these are markets in ascendancy. Looking back to 2009, we find that it hasn’t always been this way. In the third quarter of 2009, per capita disposable income in Ukraine was just UAH 3998.2 ($145.97), representing a slight increase from the same quarter of 2008, but a fall of almost 10% in real terms. Fast-forward to 2019, and disposable income in Ukraine has risen to UAH 17,934 ($654.77) — or 114.1% of the figure from the same period of 2018, and 4.6% increase in real terms. This growth is something that betting providers — as well as local and national government — are now able to tap into via regulated legalization and the promotion of responsible gambling.
Increasing Opportunities for Gaming Providers in Eastern Europe
What does this mean for other nations nearby? There has been some movement towards liberalization of gambling markets elsewhere in Eastern Europe in recent years. Neighboring Moldova, for example, operated a state monopoly on gambling from 2016 onwards, but this was halted in 2018, and the markets were opened back up to private and international investment.
To the north, Poland implemented strict online gambling laws, but amendments to legislation in 2017 have made it easier to gaming providers to operate in the country, provided they have the proper licenses. In nearby Belarus, however, online gambling is still outlawed, as it does not align with the government’s aims of attracting tourists via land-based casinos.
The opening up of Eastern European markets to regulated, licensed and responsible providers is an interesting and ongoing development. This looks likely to provide significant opportunities to gaming firms seeking to expand their international focus.