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Both the media and the state budget will lose from the ban on legal gambling advertising

The fourth year of the gambling market reform, which began with the presidential initiative to legalize gambling in Ukraine and the adoption of the first Law of Ukraine "On State Regulation of Activities Related to the Organization and Conduct of Gambling" in the national history, is coming to an end. This law not only established civilized rules for the gambling business and introduced state supervision over the activities of gambling organizers, but also established rather strict rules for gambling advertising. These rules contained a number of restrictions and prohibitions, in particular:

- a ban on broadcasting advertising on radio, television and the Internet from 6 to 23 hours;

- prohibition of advertising of gambling services in all print media (except for specialized publications devoted to gambling);

- a ban on gambling advertising on the external and internal surfaces of vehicles and the subway;

- prohibition of advertising on goods intended for persons under the age of 21, etc.

Also, gambling advertising should not form the opinion that gambling is easy to win, and that gambling can be a source of income or an alternative to work.

In addition, Article 59 provided for the introduction of liability for violation of the requirements of the legislation on gambling advertising and gambling organizers in the form of financial sanctions in the amount of up to three hundred minimum wages (UAH 2.4 million). This is quite enough to combat any abuse of the legitimate business, and it also made it possible for law enforcement agencies to easily identify illegal advertising and activities of black market companies.

At the same time, legal advertising was and still is a significant source of revenue for the media market. As a result, the system worked, legal gambling and media businesses supported each other, and everyone paid taxes to the state budget in good faith.

Since the adoption of the draft law No. 9256-d in the first reading, the situation has become threatening for both gambling and the media market, as its provisions propose to completely ban gambling advertising and trademark advertising in any media regardless of the technology of their distribution and in all print media, except for specialized publications dedicated to gambling. In reality, this will mean that there will be no other advertising except for the advertising of illegal immigrants!

The law has not yet been adopted, but there is already damage from it. At the end of May, the government adopted amendments to Resolution No. 566 of May 17, 2024 "Some issues of counteracting the negative consequences of gambling on the Internet", which provide for a ban on gambling and betting advertising in Ukraine until the adoption of draft law No. 9256-d. That is, there is no law yet, and gambling advertising is already banned.

It should be noted that if the bill is passed, the media market will lose UAH 500-700 million this year alone. If we look at the losses in terms of media types, we see

- The TV market estimates its losses at about UAH 400 million;

- The radio broadcasting market is estimated at UAH 100-150 million;

- the outdoor advertising market - at UAH 50 million;

- the Internet advertising market at UAH 100 million.

These are approximate losses for six months. Next year, the amount of losses can be multiplied by two. And it is not the case that these are the only losses of the media market, as the revenue from legal gambling advertising makes up the lion's share of stable advertising revenue. Depriving the media of most of these revenues in the current difficult economic conditions will lead to the fact that they will be forced to either reduce the volume of activities, or leave the market altogether, or... switch to advertising illegal gambling in order to survive. Because whenever there are restrictions on legal opportunities for earning money, illegal ones flourish, but if the survival of the publication depends on it, not just profit...

Therefore, I would like to emphasize once again that the fight against legal gambling, including the ban on its advertising, will benefit only the black market. The market that cannot be controlled, as proven by the practice of 2009-2020, when gambling business existed in Ukraine outside the law.


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