Today, on April 24, Ukraine’s parliament, the Verkhovna Rada, conducted a vote that is poised to bring about a significant transformation in the governance and regulation of gambling within the country.
This decision followed the submission of draft law no 9256d, which proposed the dissolution of KRAIL, the Ukraine gambling regulator.
The impact of gambling on Ukrainian society, especially during wartime, has been a subject of intense debate.
This discussion gained momentum after a petition initiated by Pavlo Petrychenko, a soldier from the 59th brigade, in late March.
The petition, hosted on the president’s office website, swiftly garnered over 26,000 signatures, triggering mandatory presidential consideration.
“The petition aimed to highlight “the harm that the gambling business causes to the Ukrainian army and Ukrainian society.”
Consequently, measures to tighten control over the online gambling industry were announced during the president’s address to the nation on April 2, with the objective of safeguarding societal interests.
The dissatisfaction with KRAIL’s performance has been persistent for over a year.
In May 2023, Deputy Prime Minister Mykhailo Fedorov proposed a draft law calling for the dissolution of KRAIL and the establishment of a new regulatory body.
Fedorov cited KRAIL’s failure to promptly issue gambling licenses as the primary reason behind the move.
The bill, supported by 272 lawmakers in today’s parliamentary vote, represents a continuation of Deputy Prime Minister Fedorov’s initiative from 2023.
It now awaits a second reading and presidential approval to become law. Alongside dissolving the regulator, the bill includes provisions for stricter gambling restrictions, such as advertising bans and enhanced protections for vulnerable demographics.
Despite the official prohibition of online gambling in Ukraine since 2009, it was re-regulated in July 2020.
Recent tax contributions from gambling businesses highlight the industry’s financial significance.
However, efforts to combat illegal gambling activities, like the recent seizure of assets from a major operator for tax evasion, underscore the government’s commitment to regulation.
The disbandment of KRAIL signifies a shift in regulatory oversight, with the digital transformation ministry set to assume responsibility.
Alina Plyushch, a partner at Sayenko Kharenko, emphasized the need to balance regulatory changes to safeguard both military interests and economic stability.
She noted the challenges associated with restricting access to online gambling and anticipated the transfer of regulatory functions to the digital transformation ministry, as now realized.