Ukrainian gambling regulator cancels licences of three Russian-controlled operators

Police and security services said the operators had provided inaccurate information.

Ukraine.- The Ukrainian Commission for the Regulation of Gambling and Lotteries (KRAIL) has cancelled the gaming licences of three operators that it said were controlled by residents of Russia. It’s terminated the licences of Joker UA, Play Fan Investment and Alphagime.

The decision, taken at the regulator’s regular meeting, includes the cancellation of two licences for Play Fan, which had permits for both online gaming and sports betting. KRAIL said it had decided to cancel the licences after the police and security services provided information showing that the operators had provided inaccurate information in their documentation.

KRAIL has previously stated that the “isolation of Russia from the gambling sphere” is one of its key priorities and that any ties between operators and Russian interests would lead to licences being terminated.

According to legislation passed in 2020 to re-legalised gambling in Ukraine, licensees must demonstrate that they do not “act in the interests of residents of foreign countries that carry out armed aggression against Ukraine, and/or whose actions create conditions for the emergence of a military conflict and the use of military force against Ukraine”.

The current invasion of Ukraine was not on the horizon at the time, but the clause was introduced because of Russia’s annexation of Crimea.

The regulator said: “KRAIL emphasises the need to strictly comply with the provisions of the current legislation of Ukraine, the inadmissibility of any ties between the organisers of gambling games and states carrying out armed aggression against Ukraine.”

Last month, the trade body the Ukraine Gambling Council (UGC) gave its support to the gambling regulator amid criticism from MPs and the media. Some are calling for the Commission for the Regulation of Gambling and Lotteries (KRAIL) to be disbanded for failing in its duties to protect Ukraine during Russia’s invasion of the country.

KRAIL has reported that its revenue from licence fees in the 10 months to October reached UAH856.5m (€23.5m). The regulator’s cost to the state budget during that time was UAH79.7m, 9.3 per cent of its revenue.

For the full-year 2021, KRAIL reported revenue of UAH1.58bn, with UAH125.5m spent on it (7.9 per cent of revenue). That means that for the whole period from January 2021 until the end of last month, fees surpassed expenses by 91.6 per cent, with revenue totalling UAH2.44bn.