In Ukraine, PlayCity, the new gambling regulator, collaborated with the Ministry of Digital Transformation to issue 250 licences in its inaugural year, marking a significant regulatory shift since replacing the former authority, KRAIL. This development, reported on Monday, reflects enhanced regulatory frameworks aimed at boosting state revenue and streamlining enforcement processes. The issuance of these licences has contributed over ₴569 million ($12.8 million) to the state budget, underscoring the financial impact of the regulated gambling market.
The distribution of licences includes 11 for gambling operators, three for lottery operators, and 213 for gaming equipment suppliers. The revival of the lottery sector, stagnant for over a decade, is particularly noteworthy, with these operators contributing approximately ₴72 million ($1.62 million) in fees. In the first quarter of 2026 alone, lottery-related tax revenues exceeded ₴74 million, while gambling organisations generated an estimated ₴14 billion in taxes, supported by an additional ₴2 billion collected from personal income tax within the sector.
A central focus in PlayCity’s initial year has been its crackdown on illegal gambling operations. The agency has imposed fines exceeding ₴988 million on entities found in violation of gambling laws, along with approximately ₴80 million in penalties related to illicit advertising practices. To enhance public engagement and streamline enforcement, an online complaints system has been introduced, allowing individuals to report illegal gambling advertisements. Offending advertisements are promptly removed, with the responsible accounts facing fines. The statutory administrative fine for illegal advertising is currently set at ₴5,188,200.
Additionally, PlayCity has blocked over 4,100 illegal gambling websites and more than 700 social media accounts with links to unlicensed gambling promotions. The time required for blocking has been reduced to as little as a day, demonstrating the regulator’s increased efficiency in addressing illegal activities. The reimplementation of mandatory reporting for gambling operators is another aspect of PlayCity’s regulatory strategy, achieving a 100% compliance rate in its first year. This reporting requirement has been expanded to include lottery operators for the first time.
The development of centralised data systems has been a cornerstone of PlayCity’s efforts to enhance regulatory oversight. Through the State Online Gambling Monitoring system (DSOM), PlayCity aims to consolidate and monitor gambling transactions in near-real time, covering activities such as payouts and bets. This system, developed with the Ministry of Digital Transformation, has already connected 11 operators. Gennedy Novikov, head of PlayCity, highlighted the importance of this data-driven regulatory model in preemptively identifying risks within the dynamic gambling market.
Alongside DSOM, PlayCity has introduced a digital licensing process via the government’s Diia portal, simplifying the licence acquisition process. Adjustments to licence conditions have been made following competitive tenders, promoting transparency and heightened market competition.
In terms of social responsibility, PlayCity has responded to over 3,000 requests for gambling restrictions and introduced a register for individuals with gambling addiction, as part of its harm reduction initiatives. Collaborative efforts with the Ministry of Digital Economy have led to the implementation of financial and time restrictions on gambling activities. Measures to prevent gambling by military personnel have been established through automated systems that cross-reference login attempts against military and restricted access lists. Research on gambling’s social impact is underway to inform future policy direction.
The agency has facilitated the adoption of 13 government resolutions aimed at reforming the market and issued 10 ministry orders addressing various regulatory domains, including premises permits, reporting structures, and the establishment of unique player identifiers. Draft amendments to the Tax Code, Gambling Law, and Lottery Law are currently under review by the Ukrainian parliament.
Looking forward, PlayCity aims to expand the DSOM to its next phase and integrate military registers with the restricted-access database. The regulator plans to update online lottery control systems, adopt risk-based supervisory frameworks, and finalize crucial legal amendments. The anticipated parliamentary approval of these legislative changes and the complete operational rollout of DSOM across all operators are expected to significantly reduce illegal gambling activities and related advertising. This trajectory indicates a more regulated gambling landscape with greater digital oversight, implying increased compliance obligations and financial ramifications for market participants.
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