_{Chairman of the Ukrainian Gambling Council on how Ukraine’s ban on gambling advertising has inadvertently fueled illegal operators. (Image: Courtesy of UGC)}

With tougher measures being introduced across Europe on gambling advertisements for land-based and online casinos, there are industry experts who offer an alternative view.  

Anton Kuchukhidze, Chairman of the Ukrainian Gambling Council, has recently written a piece on the issue.

Kuchukhidze focuses on the ban in Ukraine and begins by saying how unpleasant it is for its legal gambling market.

On May 17, the Cabinet of Ministers of Ukraine adopted additional regulation for the gambling business; in particular, it prohibited the use of military symbols in the advertising of gambling games and also obliged the organisers to introduce limits on funds and time for players. 

Ban Strengthens Position for Illegal Operators

Kuchukhidze said, “From the very first months, it has led to a number of negative consequences, the main one being the strengthening of illegal gambling operators and their media presence.

“Effective control over gambling advertising may be a better solution than a complete ban. Allowing legal organisers to advertise their services will not only improve the market situation but also better protect consumers.” 

The ban on legal gambling advertising has led to an increase in the number of advertisements for illegal gambling brands, including those connected to groups or individuals associated with the political ideology and policies of the Russian state under Vladimir Putin.

Ban Has Not Fulfilled Function 

According to Kuchukhidze, the ban in Ukraine, which was meant to address the risk of harm to vulnerable people and especially military personnel, has not worked. 

“The ban, which was aimed at reducing the level of "ludomania" (also known as compulsive gambling) in particular among the military, did not fulfil its function. “The ban, which was aimed at reducing the level of "ludomania" (also known as compulsive gambling) in particular among the military, did not fulfil its function. 

Instead of restricting players' access to information about gambling, it increased their awareness of illegal gambling brands. As legal brands are unable to advertise their services, illegal gambling brands quickly filled the information vacuum.

Kuchukhidze says, “As a result, the imbalance between the legal and illegal gambling segments has grown even more, and licensed brands have become hostages to their legal status.”  

Think Differently About Gambling Advertising  

Kuchukhidze asks for a different train of thought on gambling advertising. He points to developed countries like the US and Western Europe as examples where there are billions of dollars in turnover and no outright bans. 

"If the ban didn't work, maybe we should think about another way? You don't have to go far to find out. It is worth looking at the gambling market in developed countries with billions of dollars in turnover. You will not find strict prohibitions in the US and Western European markets. Regulation and control—yes, but not outright bans.” 

Kuchukhidze also highlights the success of the approach to gambling advertising, where they include obstacles for illegal operators.

“This approach is practiced in these markets for a reason, as comprehensive regulatory legislation, by establishing clear rules for doing business, increases competition, making legal companies better, the gaming environment safer, and creating obstacles for illegal operators.”

Kuchukhidze makes three critical points in support of his call for a change of approach to gambling advertising in Ukraine, as follows: 

• Firstly, legal advertising of licensed brands will reduce the "information noise" created by illegal operators. Accordingly, players will be less likely to play on illegal sites, which means they and their funds will be more secure.  
• Secondly, gambling advertising is a source of additional revenue for the media. Legal organisers are ready to invest in advertising, which stimulates the development of the media industry and provides new budget revenues. These funds can be spent on social responsibility programmes and support for those facing problems related to, for example, gambling addiction. 
• Thirdly, toughening regulatory legislation in any area forces companies to improve the quality of their products and services by bringing them into line with certain standards. Unlike prohibitions, this approach contributes to the gradual development of market participants rather than the decline of their business.  

Ukraine Needs to Rethink Approach to Gambling Advertising

Kuchukhidze has called for a rethink of Ukraine’s approach to gambling advertising. 

"Overall, the situation with gambling advertising by legal brands in Ukraine needs to be rethought. Instead of a ban, effective control mechanisms should be introduced to help not only protect players but also support legal businesses.

“This will allow Ukraine to create a competitive gambling market where the rights of players are protected and the state budget is filled by legal brands, rather than suffering losses due to illegal gambling.”