Ukraine’s Rada Sanctions Secondary Gambling Laws

A number of ‘secondary laws’ have been sanctioned by Ukraine’s Rada to complement its officially approved ‘Gambling Law’ requirement, forming the basis of the first ever’ Gambling and Lottery Commission ‘(UGLC) in Ukraine.

A secondary decree ‘on the creation of a gambling and lottery commission’ was approved by Rada ministers at the close of September proceedings, which will serve as the legal body of the state to track licenced gambling activities and market behaviour.

The decree detailed main requirements for the activity of the UGLC in terms of its regulatory functions, legislative authority, structure and financing.

The UGLC will be charged with handling ‘all licencing controls’ in 2021 until the government of Ukraine launches its desired federal controlled marketplace for gambling (launch date TBC).

As the industry becomes active, the UGLC will become a central agency monitoring the enforcement and industry behaviour of operators with regard to compliance with regulatory requirements, relevant laws and ensuring that modern, safer gambling initiatives are in place in Ukraine.

The decree acknowledged that, under its jurisdiction, the UGLC would be allowed to carry out ‘judicial procedures,’ but emphasised that the agency had no authority to undertake criminal proceedings.

In its review of decree requirements, Ilya Machavariani, managing partner of CIS law firm 4H Agency detailed: “It remains unclear what kind of decisions would be permissible for UGLC to make and what kind of decisions UGLC is going to make. However, UGLC most certainly would not be able to override provisions of the Law.”

Rada accepted proposals specifying that the UGLC would be headed by a ‘agency director’ serving a four-year term, who will be voted on in compliance with the Gambling Law by the Cabinet of Ministers. The director of the agency will be limited to two UGLC-leading terms.

The Government of Ukraine has announced that it will set up a new Kyiv office to house the UGLC and its six-member executive team, which will be tasked with establishing ‘regional units’ to track gambling activities.

An independent advisory board will oversee the growth and creation of the UGLC, track how the Agency has handled its licencing duties, and ensure compliance with industry standards.

The financing of the activities and programmes of the UGLC will be maintained directly by Ukraine’s state budget.

Approving the establishment of Ukraine’s first gambling and lottery regulatory authority, the decree provided that the Agency will provide a ‘positive business climate for attracting investments for the gambling industry, ensuring equal conditions for economic activity in the gambling industry and cooperating with the corresponding gambling regulatory foreign bodies.’

Machavariani added: “The UGLC powers appear to be declarative owing to the decree’s nature – they sound more like objectives or goals rather than actual legislative instruments; however the decree communicates an important message that Ukraine is looking to create a new and transparent international market.”