Russians to Clamp Down on Offshore Operators

Recent amendments to Russia´s gambling laws will make it tougher for offshore operators to provide a service in the Russian Federation.

Russia´s laws only allow in-person gambling in six designated zones. Online gambling is completely prohibited except where it has been sanctioned by the state – for example the Russian Lottery – although a regulated sports betting market is being introduced later this year.

The recent amendments to Russia´s gambling laws have been introduced to push forward the new sports betting market, and they will have implications for offshore operators – such as PokerStars, 888Poker and Bwin.Party – who provide online poker to Russian players.

“Additional Requirements for the Organisers of Gambling”

Companies wishing to participate in Russia´s regulated sports betting market already know from legislation passed earlier this year that they will have to become part of a “Self-Regulatory Organisation (SRO)” and that all online betting transactions will have to be processed via one “legal” payment processor.

Now, the recently released “Additional Requirements for the Organisers of Gambling” has introduced further stipulations that will make it tougher for offshore operators to provide a service in the Russian Federation.

These “Additional Requirements” include limiting licensed operators one online domain, the necessity for their servers to be located within Russia and the display of the government´s seal of approval on their website.

These amendments are intended to make it easier for the government to establish which betting sites are operating legally and which should be pursued for breaking Russia´s gambling laws – although, with online transactions to unlicensed gambling domains about to be blocked, it is unlikely that many of the bigger online poker and casino sites will continue to serve players in Russia (*).

(*) Some of the existing offshore operators who provide a service to players in the US circumnavigate payment processing laws by using Western Union or MoneyGram to conduct “person-to-person” transactions.

Amendments Welcomed by Russian Betting Organisations …

Leaders of the two largest Russian betting organisations have welcomed the amendments because, they say, it clarifies the government´s position on online gambling – at least for sports betting.

The President of the Russian Bookmakers Association – Konstantin Makarov – said that any clarification of Russia´s gambling laws was a good thing, and he called on the authorities to back up the amendments with more enforcement action against unlicensed offshore operators.

Oleg Zhuravsky – President of the First Self-Regulatory Organisation of Russian Bookmakers – commented that the amendments were further evidence that online betting was now sanctioned by the state. He added that bookmakers within his organisation would be happy to work within the new legislation because they would benefit from the “exodus” of unlicensed operators from the online market.

… But not by Russian Punters

In contrast, Russian gamblers were not so thrilled with the news. When an interview with Oleg Zhuravsky was published on the online portal bookmakersrating.ru, many of the comments beneath the interview called for the licensing of offshore bookmakers similar to the UK´s regulation.

The authors of the comments felt that it would be better to have access to international sites that would allow them to bet in US dollars rather than “stupidly run” state-sanctioned sites, which limited their action through ring-fencing the market and were open to corruption.

However, most agreed that with the length of time it was taking to implement a regulated online sports betting market, there would be few changes to their current gambling habits at offshore poker and casino sites.