Зразки роботи європейського регулятора грального бізнесу, питання державної системи механізмів контролю ринку та грошових потоків від гравця до сплачених податків, регулювання діяльності казино в Європі тощо. Учасники семінару отримали поради щодо структури, операційної діяльності, відповідності, регулювання та ліцензування грального бізнесу тощо

1. Introduction:
European and
global practices
which can be
applied in Ukraine
“Gambling in Ukraine: learning from the
international experiences”, January 2020, Kyiv, Ukraine.
presented by Philippe Vlaemminck, partner at pharumlegal

2. different types of
games
introduction
1

3. Different types of games:
The product features and the way the
products are experienced by players, is
different for lotteries and other types of
gambling
The player profile of players playing lottery
games is typically different from the player
profile of players playing casino games or
also sports betting
Lotteries
Betting
- horse betting
- sports betting
- event betting
Gambling
- casino games
- slot machines
- arcades

4. A hierarchy of games can be
made in terms of their risk profile
Sports betting can also be very engaging
for players as there is often the idea that
the player’s knowledge of the
competition/teams can help bring about
positive results when betting on them
Certain forms of betting (e.g. live-
betting) are more dangerous and have a
short time span between take and result
Online casino gambling is
considered as more
dangerous than land-based
sports betting
The lowest risk level
(addiction, problematic
gambling, societal risks etc.)
lies with lotteries

5. A hierarchy of games can be
made in terms of their risk profile (2)
The Court of Justice of the European Union and the EFTA Court have
recognized that different games lead to different risks of addiction
In Carmen Media, the Court recognized that the “short odds games”
(e.g. (online) casino games, card games, slot machines), where the
potential gratification takes place instantly, generate a higher risk of
addiction than “long odds games” (e.g. lottery games)
Different risk level requires different approach

6. is regulation on
lotteries, betting
& gambling
market needed?
why
2

7. Lotteries, betting & gambling is sensitive
activity which may involve:
Organized criminal activities
Money-laundering practices
Funding of other illicit and criminal
activities
Defrauding the government of tax
revenue
Compromising sports integrity
by criminals who use gambling
to obtain financial advantage
through their fraudulent activity

8. Lotteries, betting & gambling activities
require measures which:
Protect consumers & vulnerable
groups form being harmed or
exploited by gambling
Combat illegal gambling
activities, betting-related
corruption & match-fixing
Ensure integrity and fairness of
the games
Protect integrity & ethics of
sports betting
Protect society from adverse
effects of gambling

9. to create a modern
framework to
regulate lotteries,
betting & gambling
market?
how
3

10. WHAT IS NOT
PERMITTED IS
FORBIDDEN
Have a clear definition of
what is permitted in your
jurisdiction. There should
be general prohibition
unless explicit permission
is given
Be aware that new forms of
illegal lotteries, betting &
gambling activities have
emerged (so-called
parasite, secondary lottery
products)
1

11. EFFECTIVE
ENFORCEMENT
2
The need to effectively
regulate lotteries, betting &
gambling activities requires
supervision through a
regulatory public authority
The Regulatory Authority
should be subject to
parliamentary control to
ensure supervision & to be
held accountable

12. Poland: General supervisory authority for gambling rests with the
minister competent for public finance (currently the Minister of
Finance).
MINISTER AS A REGULATOR
Czech Republic: The Ministry of Finance is the gambling supervising
authority. Some gambling aspects are also supervised by the Czech
Customs Administration (Customs) and by the relevant local
municipalities.
Finland: The Ministry of the Interior affirms the rules governing
gambling via a decree. The National Police Board supervises the
implementation of gambling games at national level.

13. INDEPENDENT AUTHORITY
MIXED SUPERVISION
France: the French Autorité de régulation des jeux
en ligne, usually referred to as ARJEL
Belgium: the Belgian Gaming Commission
The UK: the Gambling Commission
The Netherlands: The Netherlands Gambling
Authority (Ksa)

14. • control the operators in all circumstances
• act against illegals & exercise its power
• impose licence conditions
• ensure that licencees comply with the law and with the licence
conditions & codes of practice
• give specific advice or guidance to licence holders
• take remedial or preventive action
• review financial information
• ...
REGULATORY AUTHORITY SHOULD
HAVE THE POWER TO:
CHARACTERISTICS

15. ENABLING CLAUSE SHOULD ALLOW
REGULATORY AUTHORITY TO:
• act on a short term notice
• exercise effective law enforcement tools
• impose fines/sanctions against:
- bluntly illegal gambling
- parasite (secondary) lottery / betting products
- lotteries, betting and gambling operations without a license
- ...

16. LOTTERIES, BETTING & GAMBLING ACTIVITIES
SHOULD BE MONITORED
State needs to have permanent right to control lotteries, betting and
gambling activities including through online systems e.g. to identify
players (KYC)
All gaming terminals in a jurisdiction have to be connected to monitoring
system that enables the regulator to monitor all gaming activities
The operator has equally the obligation to monitor player (KYC and
responsible gaming)

17. CLEAR
LICENSING
CONDITIONS
3
LICENSEES MUST COMPLY WITH
THE FOLLOWING RULES:
Financial solvability: can
they finance their activity?
Will they be able to pay?
Integrity: are they reliable?
Do they follow the rules and
can they be checked?
Transparency: is draw
taking place in clear and
transparent manner?

18. • Games
• Marketing
• Corporate Social
Responsibility (CSR)
• Retail network
• Mobile network
• ...
Licensing process
should not be based
only upon financial bid
but also:

19. Price for a license should at least cover administrative costs of
your operations, e.g. maintaining your premises, personnel etc.
It varies from country to country depending on conditions for
operations, level of taxation, advertising restrictions etc.
License should be distinguished from a concession. Concession
is a compensation for a right to operate a service. It involves a
contractual obligations and transparent bidding process.

20. GAME DESIGN
4 Use fair and random RNG
systems
Take appropriate steps to
minimise the risk that a
new game or its features
will appeal to minors
Apply (self)-
exclusion systems
THE LEGAL FRAMEWORK SHOULD
ENSURE THAT THE LICENSEES:

21. CERTIFICATION
5
Certification of gaming
equipment must be carried
out in accordance with
international standards
ISO (in particular ISO/IEC
27001:2013) is as
international standard
followed by Europe and the
WLA Security Control
Standard (WLA SCS) is the
most strict lottery sector's
internationally recognized
security standard

22. SOME EXAMPLES:
Certification of gaming equipment should be performed by reputed
international certification bodies.
• BMM Testlabs
• Gaming Laboratories International (GLI®)
National Accreditation Agency of Ukraine (NAAU) is a signatory of the EA Multilateral
Agreement (EA MLA) and must respect the mutual recognition of certification bodies
from other States according to “Accredited once, accepted everywhere” principle.
They both are licensed worldwide, in different jurisdictions all
around the world and provide hardware and software testing.

23. FAIR AND
TRANSPARENT
DISTRIBUTION:
RETAIL
6

24. THE LEGAL FRAMEWORK SHOULD ENSURE THAT THE
LICENSEES:
• Put clear contracts in place with regard to the
responsibilities & liabilities of points of sale (POS)
• Impose strict and transparent rules on how retailers collect
money and pay out winnings
• Ensure retail outlets do not manipulate with tickets e.g. by
putting them aside & do not make payouts to minors
• Provide compliance trainings for staff to ensure they comply
with law & rules on responsibility

25. THE LEGAL FRAMEWORK SHOULD ENSURE THAT THE
LICENSEES (2):
• Have age verification systems in place in line with a hierarchy
of risks:
- In arcades and casinos age verification should take place
upon the entry
- For betting and lotteries contract between a player and an
operator should determine the minimum age of a player
- For lottery retailers the verification of players’ age should
take place via e.g. mistery shopping

26. FAIR AND
TRANSPARENT
DISTRIBUTION:
ONLINE
7

27. THE LEGAL FRAMEWORK SHOULD ENSURE THAT THE
LICENSEES:
• Ensure ID verification of customers
• Ensure customers' right to privacy
• Put strict e-wallet limitations / per day / week / month

28. THE LEGAL FRAMEWORK SHOULD ENSURE THAT THE
LICENSEES (2):
• Have anti-money laundering & KYC procedures in place
• Establish automatic re-transfer of substantial winnings
from e-wallet to bank account to avoid continuity of
playing
• Have monitoring system in place to intervene when
players play too long

29. ADDRESS
TECHNOLOGICAL
OPPORTUNITIES
& CHALLENGES
8
Artificial Intelligence (AI)
Virtual Reality (VR)
Distributed Ledger
Technology (DLT, blockchain)
Virtual currencies
Lootboxes

30. MORE THAN
JUST A TREND
Blockchain as an opportunity
for lotteries, betting &
gambling
• Full decentralization of the platform
makes it independent, autonomous,
anonymous, secure and transparent
• Tickets can be traced and these
which are misused / stolen could be
deactivated remotely
• Blockchain creates a unique and
certified ID to access to network of
gaming ecosystem
• Blockchain guarantees remote ID
winners verification
• ...

31. WHAT TO DO?
• The digital challenges need to be
further endorsed and implemented
• Legal lottery, betting and gambling
operators have a potential to be
pioneers in those areas to set the
rules & principles
• The Regulatory Authority must have
power to stop or regulate the
negative effects of technological
developments
Task for a government:
create a (legal)
framework

32. SOCIAL
RESPONSIBILITY
9

33. THE LEGAL FRAMEWORK SHOULD ENSURE THAT
THE LICENSEES:
• Comply with social responsibility standards
• Protect players and integrity and fairness of the games
• Apply policies and procedures to prevent underage gambling
• Protect children and other vulnerable persons form being
harmed or exploited by gambling (e.g. design social
campaigns to prevent addiction)

34. THE LEGAL FRAMEWORK SHOULD ENSURE THAT
THE LICENSEES (2):
• Comply with responsible advertising standards
• Provide training for staff on compliance &
responsibility
• Comply with sector's standards & certification schemes
(e.g. World Lottery Association)

35. to avoid when
creating a framework
for lotteries, betting &
gambling market?
what
4

36. DO NOT
ENDORSE THE
OFFSHORE
LICENSES
1

37. OFFSHORE LICENSES
OFFSHORE
JURISDICTION
CUSTOMER'S
JURISDICTION
Some jurisdictions have set up a legislative scheme whereby
online operators can obtain a license with an additional
favourable taxation if they offer their games exclusively outside
own jurisdiction to customers in any other jurisdiction

38. OFFSHORE LICENSES (2)
This undermines the other states right to
protect its citizens and their public order
Games offered throughout the EU from
offshore hubs are therefor blocked by
almost all states in the world

39. • The Court of Justice of the European Union (“CJEU”) ruled that an
offshore licenses of Gibraltar or Malta are illegal in other Member
States
• There is no mutual recognition of authorisations issued by the
various Member States can exist in the current state of European
Union law (CJEU case-law in Santa Casa, Stoß and Others)
• Each Member State may wish to monitor an economic activity
which is carried on in its territory
OFFSHORE LICENSES (3)

40. OFFSHORE
ACTIVITIES ARE
NOT ACCEPTED
in any other jurisdiction neither in the EU, nor
anywhere else in the world, except for a few
offshore minded islands

41. ADVERTISING
RESTRICTIONS
2

42. • Have a consistent and
responsible gambling policy
whereby the specific, less
addictive, (lottery) products are
given an appropriate place in
the government policy
A so-called "total
ban" on lotteries,
betting & gambling
advertising can be
counterproductive

43. ALLOW FOR MODERATE ADVERTISING
OF LEGAL OPERATORS
• Allow for advertising which would
channel consumers to a
responsible legal offer in order to
take them away from illegal
gambling offerings
Regulate according to
hierarchy of risks
approach: different
treatment when it comes
to lottery games and
other games of chance
(i.e. casino or betting
games).

44. THANK YOU!
Philippe Vlaemminck
partner, pharumlegal