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What are the differences between the gambling business of Ukraine and Georgia? Expert videoconference report

International Advisers Associations representatives Alexander Lysyi and Andrey Reun, together with Talentgrator Marketing Director Lavrentiy Gubin, discussed the problems of starting the Ukrainian gambling market. This includes the registration of trademarks, and the problems of working with banks, certification and taxes. Why did the gambling market start much easier in Georgia? Read the Gamingpost.net report.

  • Interview
  • 2021-03-30 14:45
  • 1473

A huge number of documents, forms, assurances and signatures - this is how experts characterize the process of obtaining licenses for the gambling business in Ukraine. One mistake - and everything needs to be reassembled. At the same time, just to collect the necessary package of documents, you need to start preparing for a year and a half, says Alexander Lysyi, head of the gambling industry committee of International Advisers Associations.

“If we take it by trademarks, then the standard period without acceleration is up to two years when it can be obtained. If with acceleration - it is eight months. There are, of course, successful cases where 6 months in advance, but in general it is better to do everything in advance. The procedure is the same there, it doesn't matter if it is online or offline,” - says Alexander Lysyi.

Also, there is a problem in opening a bank account, because it is also necessary to apply for a license. But until now, not all banks are ready to work with the gambling business, says Alexander Lysyi.

“Our leading Ukrainian banks cannot start working with gambling since their main policies prohibit cooperation and support of gambling business in a particular country. Moreover, when the market began to be legalized, there were initiatives from some operators for banks to change their policies. But they refused there,” - says Alexander Lysyi.

Experts once again noted the problem with equipment certification.

“Now certification is under consideration, lists of laboratories that can be certified are being formed, and if we take the requirements of the law on standardization, there are three ways how equipment can be certified. The first one is through the Ukrainian subject of certification, which complies with the relevant law. The second is a foreign one, which is recognized by Ukraine. And the third is a foreign subject of certification, which issued a certificate within the framework of an international association, which had previously agreed with the Ukrainian national subject of the certification. The third point, it would seem, is that it is such a thing to get a foreign certificate, but that logo of an international subject of certification is very difficult to obtain. We were interested in the procedure itself. If you receive international certification, such certification will take at least 6 months,” - says Alexander Lysyi.

Experts are also confused by the current tax code because amendments to it have not yet been adopted. And how to interpret the old one is also not completely clear.

“If you read the spelling rules, then what after the comma refers to what was said earlier. But if we include logic and common sense, then we can conclude that we have previously described slot machines. Therefore, it would be logical to assume that 18% of GGR - it deducts bets, unlike GGR on slot machines,” - says Andrei Reun, co-head of the International Taxation Committee of International Advisers Associations.

Lavrenty Gubin, Marketing Director of Talentgrator, says: the market started much easier in Georgia. And the rules for him are much more transparent and simpler.

“The part of the Ukrainian legislation that defines license fees and imputed taxes per unit of equipment for ground facilities was taken following the example of Georgia. Because here the only thing that exists is a license for land-based casinos and slot halls. And there is a tax on every piece of equipment. Moreover, what is interesting is that in Georgia you cannot open an online casino without a land-based casino. Some operators started by making an almost fictitious casino in an area with minimal licenses, and due to this they made online casinos,” - says Lavrenty Gubin.

Lavrenty Gubin notes that high licenses are beneficial for the state, because, firstly, the state receives money in advance, and secondly, the operator can be deprived of this license. Lavrenty Gubin says that in Georgia, the gambling business made a colossal contribution to the tourism market and provided up to 30% of the industry's revenues every year before the pandemic. The casinos in Georgia have not been working for the last year. And the gambling business in the country is starting to change.

“Firstly, Ukraine comes in - this is a serious competitor for the target audience of Georgia - these are the Arab countries, Turkey. Plus, now the state demands to pay the next licensing fees, it seems like they are allowed to open casinos from April 1. And people stood closed for a year with licenses paid before. The question arises - how will we pay if we did not work for a year, and there were still expenses. There is a debate, casinos do not want to open in Tbilisi. Newcomers are opening in Batumi, who still have to be paid. In general, interesting events await us,” - says Lavrenty Gubin.

The experts also discussed the issue of tax on winnings. They believe that the Ukrainian system needs to be changed because players simply will not go to legal casinos.

“Imagine that there is a player who can bring several tens of thousands of dollars to your country. It's just that he needs to be given a medal for this. And you still want to take taxes from him. Well, is that fair? Of course not. He should happily go to you and bring money. If he loses them, they will remain in your country. 90% will be taken by the state in the form of a license, tax, taxes on salaries. And you also want to take from the player. The player will simply not come to you then,” - says Lavrenty Gubin.

Without cooperation with the authorities, the legal business will not be able to compete with the “shadow” market. Experts note that only with the help of mutual understanding with the authorities, legal casinos will be of interest to players and will bring profit to the country.

“The illegal operator is much freer in their marketing campaigns. Therefore, we must allow advertising within reasonable limits, and let people develop, grow, offer some kind of shares so that they are competitive in comparison with illegal operators, this is very important,” - says Lavrenty Gubin.

The report especially for Gamingpost.net

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