This year marks the 5th anniversary of the adoption and entry into force of the Law of Ukraine ‘On State Regulation of Activities Related to the Organisation and Conduct of Gambling.’ In 2020, this law brought the gambling business out of the underground, where it had been for a decade.
Recently, the Accounting Chamber of Ukraine conducted an audit of the legal and illegal gambling market in Ukraine. Based on the audit, Anton Kuchukhidze, head of the All-Ukrainian Gambling Council, concluded how the reform is going. He also outlined tasks for improving the conditions of the legal gambling market for the website Ukrainski Novyny.
Significant growth in tax revenues
The audit by the Accounting Chamber of Ukraine on ‘The gambling business: expectations and reality’ shows that the legalisation of the gambling business in Ukraine has significantly increased tax revenues from licensed operators. Thanks to licence fees, the state budget has been replenished by billions of hryvnia over the past five years.
Commenting on the positive financial dynamics of the reform, Kuchukhidze draws attention to gaps in the regulatory framework that are preventing the market from realising its full potential. He stated: ‘The problem of combating the illegal market remains relevant, as it hinders the normal operation of licensed companies and reduces the effectiveness of measures against gambling addiction.’
According to the report, after the introduction of state regulation of the gambling market and the creation of the Commission for the Regulation of Gambling and Lotteries (CRGL), 88 operators received licences. Their total revenues grew from 3 to 142 billion Ukrainian hryvnia (from €61.8 million to €2.93 billion), and the amount of taxes paid increased from 200 million to 17 billion hryvnia (from €4.17 to €351 million).
Measures against illegal operators
‘The ineffective mechanism for blocking illegal sites, weak enforcement of sanctions and uncontrolled advertising of gambling contributed to the formation of the shadow sector,’ Kuchukhidze continues. According to the report, CRGL did not fully comply with the task of blocking the sites of illegal operators: out of 512 requests to their owners and hosting service providers, only 148 were fulfilled.
As for other legislative measures, during its existence, CRGL imposed fines totalling 35.7 million hryvnia (€745,000). Of this amount, operators paid only 20 per cent, and the Commission imposed no new penalties during the year. In addition, the body revoked the licences of companies subject to sanctions by the National Security and Defence Council of Ukraine (NSDC) only five months after the decision was made. ‘The reason is the incapacity of CRGL due to the lack of a quorum,’ explains Kuchukhidze.
The need to protect players in the online segment
The Accounting Chamber expressed concern about the delay in implementing the State Online Monitoring System. The Cabinet of Ministers adopted a resolution in December 2023, approving the procedure for the system’s functioning. Only the new regulator, PlayCity, has begun efforts in this direction.
The creation and application of this tool is necessary for a realistic assessment of financial turnover in the sector, says Kuchukhidze. The system will also provide additional mechanisms to protect players.
The expert draws attention to the transition of players to illegal online operators, which stimulates the spread of gambling advertising. ‘Such actions can exacerbate the negative consequences for society. In particular, they increase the risk of gambling addiction, loss of funds by players and illegal use of their data,’ Kuchukhidze emphasises.
Licensing of the lottery business
Under the same law regulating the gambling market, the licensing of lotteries was transferred from the Ministry of Finance of Ukraine to the authority of the CRGL. However, the Commission was unable to approve the licensing conditions, and therefore, it did not issue licenses. The last licences for lottery operators in Ukraine expired back in 2014. According to auditors’ calculations, the state budget lost more than 220 million hryvnia (approximately €4.8 million) in revenue from the sale.
According to Kuchukhidze, the lack of regulation in the lottery business is a problem, as it allows a portion of the gambling industry to operate in the shadows. As a result, lottery operators organise gambling without licences and cause damage to the budget every year.
PlayCity begins fining casinos
Meanwhile, the new regulator, PlayCity, continues to check gambling operators systematically. Eight licensed casinos have already been fined 400,000 hryvnas (approximately €8,300) for violating the law. The regulator sanctioned Golden Bonus, WinBoss, WinBoss Slot Machines, F1RST, Royal Club, WIN, 4444 and Party Casino for failing to submit reports on time.
Reporting is a mandatory requirement for legal gambling businesses in Ukraine. According to the law, each operator must regularly report on:
- compliance with licensing conditions;
- financial status and movement of funds;
- measures taken to prevent and combat gambling addiction.
Reporting also includes other key indicators defined by law.
Key objectives of the gambling business in Ukraine
Shortcomings in the gambling business regulatory system have not only budgetary but also social consequences. In this regard, the Accounting Chamber calls for closer cooperation among state authorities, including the national regulator, law enforcement agencies, the prosecutor’s office, and parliament.
As part of this cooperation, Ukraine needs to develop and implement an effective monitoring and control system. This is necessary to activate mechanisms to block the activities of illegal operators and bring them to justice, says Kuchukhidze.
Only systematic and coordinated work by all participants in the reform can ensure a favourable environment for further market development. ‘We are creating uniform rules for all market players and continuing to bring the gambling business into the transparent sphere,’ the Ministry of Digital Transformation of Ukraine states its intentions.
This article was first published in Russian on 5 August 2025.
