Russia mulls point of consumption regulatory regime
State Duma to debate clampdown on offshore gambling as risk level heightens for unlicensed operators
Russian legislators have introduced a new bill amending the country’s gambling laws to combat offshore gambling sites.
The bill focuses on preventing offshore gambling by introducing qualifying conditions to determine if gambling operations are being carried out in Russia or elsewhere.
These include a player’s location, the location of their bank or payment provider, the IP address of the player and the player’s phone number.
Under the terms of the bill, if one of the above criterion are met, then the gambling itself is deemed to be occurring within the territory of Russia and is therefore subject to Russian gambling legislation and its domestic tax laws.
“This bill changes the risk profile for operators in accepting Russian players without a Russian licence, as it removes the potential for doubt in determining whether that firm is offshore,” 4H Agency CEO and senior partner Ilya Machavariani told EGR.
“Essentially, it might be fair to say that if this bill passes, then the “point-of-consumption” regime would be fully installed in Russia,” he added.
Sports betting and Tote betting transactions are required to be registered on the TSUPIS system, a central payment wallets system which allows the Russian government to levy taxes against operators and players alike.
In addition, the bill introduces a blacklist of offshore gambling operators and offshore payment service providers (PSPs).
Offshore operators and PSPs will be added to the blacklist if regulators can establish they are serving Russian players without a licence, with Russia-based banks obliged to block all payments made from these entities.
In tandem, the bill introduces a “whitelist” of permitted gambling operators. Russian financial institutions will be forbidden from signing contracts with any providers that don’t make the list.
The bill will be subject to three readings in the Russian State Duma before being passed into law. It could be subject to further amendments as it passes through the legislative process.
Supporting documentation in the bill seen by EGR outlines Russian authorities intention to introduce administrative liability for payment institutions who violate legislation by transfering monies to offshore gambling operators in the blacklist and outside whitelist.
The Russian gambling regulator is also empowered to block websites of not only offshore operators but payment institutions as well.