"Blocking is not a 100% effective tool." Interview with the head of the gambling market regulator

"Our task is to block access to illegal gambling," says Gennady Novikov. In April 2025 he took the lead the Play City agency, which regulates the gambling market.

The structure was created on replacement CRGL – Commission for Regulation of Gambling and Lotteries. In December 2024, the head of CRGL, Ivan Rudoy, was detained on suspicion of facilitating the activities of Russian online casinos.

Novikov also previously worked at KRIL, serving as Deputy Head of Staff. From 2018 to 2020, he worked at the Ministry of Digital Transformation, initially as a leading specialist in the IT industry development department. Later, he became the head of the expert group for the development of e-commerce and business in the Directorate of Digital Development.

Play City accountable Ministry of Digital Transformation.

LIGA.net I spoke with Novikov about what exactly his agency is doing to destroy illegal online casinos, as well as about what is happening in the offline gambling market and about fines for Telegram channels and media.

When will the online monitoring system for the gambling market be launched?

What are the results of your work in this position?

We have started many things, but this is not the final result yet.

What they actually did: they launched a new body.

Secondly, we have started monitoring the market. This includes our licensees: online casinos, the betting segment, and so on. And also the entities that distribute advertising.

Progress has also been made in creating a state-level online monitoring system. It is intended to be a key element of transparent and effective market oversight. The documentation for the tender will be ready shortly.

We plan to launch it at the end of August – beginning of September. I think that this year we will launch the first version of the state online monitoring system.

What does "first version" mean?

This is a complex and comprehensive product, so there will be several implementation phases. In total, it will take at least a year to fully develop and launch it. We consulted with the market and IT companies that have experience building similar systems, and these are their calculations.

Understanding that we don't have much time left until the end of the year, we decided to focus on what, in our opinion, is most important for the state. This is the issue of money in this market. The system will control the inflow and outflow of money.

This is the main issue from a taxation perspective – the funds that came to the organizer, and the funds that went from him to the player.

In general, the online system should "watch" how money works within the game.

What other results are there?

We have already established a process for blocking illegal websites.

Almost 1500 websites have already been reported for blocking. In the public system, released last week, anyone can see which sites we have blocked. They can also report a site they find themselves.

You can also complain to the provider if they continue to provide access to a website that is on the blocked list. Because this is a problem in the market.

We make a decision to block, we pass it to the NCEC (the regulator of the field of electronic communications), it makes its corresponding decision and brings it to the providers. And they, in turn, do not always comply.

We want there to be an additional control tool: so that the National Energy and Utilities Regulatory Commission (NEURC) can see which of the supervised providers are not complying with their decisions, and can go to them for inspection and, possibly, impose sanctions.

How much money is needed to develop an online monitoring system?

This year, 84 million hryvnias have been allocated for the monitoring system and licensing registers. We will not be able to fully utilize these funds because, according to market estimates, the development of the system will take a year, and we do not have that time in this fiscal year.

How much will the development of the first part of the system you plan to build cost?

I can't answer that question right now; we're currently conducting research and adapting the technical requirements. We plan to request IT company assessments again. We will calculate the arithmetic mean.

We plan to release the first version this year, and then it will depend on how the funds are allocated. If all the stars align and the funds are allocated, then by the fall of next year it will have full functionality..

Blocking, P2P payments, NBU (National Bank of Ukraine)

Before the interview, I spoke with market players, and they gave me a list of unblocked illegal casinos. And they asked me to ask: why haven't you blocked them?

Blocking as such is not a 100% effective tool in general.

We submit the site for blocking, our decision is public, and it doesn't even have time to reach the providers. This site changes its mirror, it's not very expensive. And it works as before.

They're sending out an email to their customer base: we're now on a new mirror site. And it continues to work.

I'm not saying we should abolish blocking. It's one method, but not a panacea. Blocking illegal advertising and payments to illegal organizers is also necessary. Specifically, P2P payments.

If they don't have advertising and payment options, the share of illegal operators in the market will be close to zero.

Do you have a dialogue with the National Bank regarding payments?

We haven't met with the National Bank yet. We are, of course, requesting this meeting together with the Ministry of Digital Transformation.

Formally, PlayCity has one direct power to combat illegal gambling – blocking the websites of illegal casinos. And one indirect power – imposing fines and blocking their advertising (just as fines and blocking advertising of legal operators are imposed if it is distributed improperly).

That's where our competence ends. But we, together with the Ministry of Digital Transformation, are looking at the situation comprehensively and consider it our task to bring together the relevant state authorities in order to ensure that the gambling market in Ukraine is 100% legal.

Therefore, we are going to the National Commission for the Regulation of the Electronic Communications Market (NCERCM) to talk and get the final result. And although our powers end with sending a letter to the NCERCM with a list of websites to block, we are still interested not in the formal performance of duties, but in the result.

Our shared goal is to block access to illegal gambling. That's why we've developed a tool that allows you not only to report a website, but also to complain about the provider.

The same goes for the NBU (National Bank of Ukraine). We cannot avoid going to them and talking about this. Because the problem will not solve itself.

Anonymous Telegram channels, the "Trutha" fine, and casino advertising on Instagram.

And how can you block ads in Telegram? I understand how you fined the "Trūha" channel. But what about other channels?

Let's break this down. Telegram has two forms of advertising. Advertising on the Telegram channel itself – that's the case you mentioned – and Telegram Ads. This is advertising distributed by Telegram itself.

Regarding the channels. I won't hide the fact that it can be difficult to identify the owner. But we have state agencies that help us do this.

If there are more cases of advertising being distributed through Telegram channels that do not meet the requirements, we will continue to apply the list of tools that the legislator has given us, namely fines.

Regarding Telegram ads, we have contacted Telegram to address this issue as well. We are awaiting their response.

And how many anonymous Telegram channels are you currently identifying the owners of?

Regarding Trukha, it has been determined, and accordingly, there is a fine. For the others, if we don't see a fine, it means it hasn't been fully determined yet. Proceedings are underway, that's all I can say.

And how many are there? Are there ten?

So far, less. We've only just started.

Are there any proceedings regarding the media?

About ten. Our current focus is on illegal advertising on Instagram. We have the most cases there – about 50.

Has Truha already paid the fine?

There is time for voluntary payment. This is three months from the date of the decision. If they appeal the decision during this period, it is recognized as an enforcement document from the date the relevant court decision enters into force.

If they do not pay or appeal during this period, the decision is transferred to the enforcement service for enforcement.

What stage is this story at now?

I haven't seen the lawsuit against us yet. I don't know what they plan to do.

And speaking of history in Dev.ua Could this media outlet have been warned about the violation before such a large fine was imposed?

Let's get things straight right away. At the time of the violation for which they were fined, Dev.UA was not a media entity. That's just a fact.

But they did submit the registration documents.

Well, what does it mean, they applied? Following that logic, let's say a casino applies for a license, we don't issue it for one reason or another, and they start operating anyway. But what if they were actually refused?

They were not media entities. That is a established fact. Therefore, according to the law, they had no right to advertise gambling. As for warnings, unfortunately, the legislature did not provide for warnings. There are only penalties right away.

However, they were notified of the commencement of administrative proceedings regarding the imposition of a fine and of their rights as a participant in such proceedings within the timeframes and in the manner prescribed by the Law of Ukraine "On Administrative Procedure".

What does a legal gambling market look like?

How much tax did legal players pay in 2024 and the first half of 2025?

For the entire year of 2024, 18 billion UAH in taxes and 2 billion UAH in license fees. For the first half of 2025, projected revenue is 9.6 billion UAH.

What is the size of the illegal market? Legal players estimate that it's half of the market, the "black" half. Is that true?

Unfortunately, there is no research on this issue yet. We plan to conduct it so that professionals can assess the market.

But, yes, the legal market says that 40-50% is in the illegal sphere, and intuitively we agree with them.

We want to start measuring the ratio of the black market to the white market, at least starting this year, so that next year, at the same time, we can commission the same study and compare year to year.

This is the only correct tool for assessing and analyzing the relevance and effectiveness of public policy in this field.

How many legal online casinos are there now?

There are 19 online casinos, two online poker organizers, and four bookmaking companies.

And how many players are there in the offline market?

There are four casinos, ten gaming halls with slot machines, and one betting shop.

How is the offline market doing?

It's bad. We see that halls are closing. At general meetings, they say that the situation in the country is very difficult for them.

There is a curfew. There is no tourist flow, and tourists are the main part of the visitors to offline establishments. They entered the market before the start of the full-scale invasion and expected completely different conditions.

We know that when there were blackouts last summer, online sales dropped significantly. But offline sales are constantly in a situation that was temporary for online sales.

There are many questions about the legislation. We have a very complex and ill-conceived system in terms of taxation. For example, the tax on winnings. Currently, any payment from the organizer is taxed as a tax on winnings.

What does this mean in practice? There's a bet of 1000 hryvnias. There's, for example, a bookmaker offering odds of 1:1. What does that mean? It means I bet 1000 hryvnias and, for example, I win 1100. The tax authority's position is that when this 1100 hryvnia payout is made by the bookmaker, the tax should be applied to the entire amount of the payout. And that's 23% of 1100.

And I, the person who bet money with a legal operator and won, receive less than I bet. And this is not a competitive advantage in favor of illegal operators. There are no taxes there at all.

We're not saying that the legal system should be exactly the same, but it should at least be fair. The 23% should apply to the difference, to 100 hryvnias, not to 1100.

And this is also one of the tools to combat the illegal market. It's about creating normal working conditions for the legal market.

Digital licenses. When will they be implemented?

We want to digitize six main licenses in the market by the end of this year. They will relate to the activity, not the equipment. These are online bookmaking, online casinos, offline casinos, online poker, gaming halls, and a license for providing services in the field of gambling.

You will be able to submit an application through the "Diia" portal.

I see the development of events as follows. We will digitize six licenses, see how it works. Then we will propose to the legislators to change the approach to licensing. I would like licenses to be issued without the participation of officials at all and without the possibility of submitting license applications in paper or by e-mail..

Lotteries and a new register of gambling addicts

Are any changes to the regulations in the lottery market planned?

The lottery market in the country has not been restarted for more than ten years. Lotteries currently operate under the transitional provisions of the 2012 Law "On State Lotteries in Ukraine". All licenses that existed at the time the law was passed remain valid.

The Lottery Law stipulated that the Cabinet of Ministers should adopt new licensing conditions for lotteries within 3 months (i.e., in 2013). These could have been adopted either in 2013, when gambling was banned, or in 2021, when gambling was legalized and several amendments were made to the Lottery Law. However, this was not done.

What does this mean? Lotteries have been removed from the supervision of the Ministry of Finance, which was the market regulator before. They were supposed to be transferred to the State Service of Gambling and Lotteries (CRGL) upon adoption of licensing terms. But they haven't been transferred. Now they are in a suspended, uncontrolled state.

The second point: they don't pay licensing fees. The legislator provided for three licenses in the market, which as of today is 67.2 million UAH per year. This is just licensing revenue. Excluding taxes.

This also needs to be controlled. The Ministry of Digital Transformation is currently in the final stages of issuing a document that will regulate the restart of the lottery market. Next, it will be subject to public discussion, then there will be a procedure for coordination with all interested bodies, and it may be submitted to a government meeting for adoption.

PlayCity will also be responsible for licensing and overseeing lottery activities.

What else do you plan to implement by the end of the year?

By the end of the year, I think we will create a new register of individuals whose participation in gambling is restricted. The current one does not meet legal requirements. There are issues regarding personal data protection.

We conducted a technical analysis and decided that it would be more appropriate to create a new registry. We want to make it in accordance with all the latest standards in the field of state registers.

Make it secure and more adapted to the real market.

I'll explain what I mean now. Our market is very dependent on events, especially sporting ones. If, hypothetically, there's a Usyk fight, the number of requests to the registry is many times greater than on a regular Saturday.

Therefore, we need a solution that, on the one hand, will not constantly work with such a large number of requests, because it is expensive for the state. But it will be able to expand under certain situational loads. And this is what we want to implement in the new registry and launch it this year.

How many people are currently registered in the gambling addicts registry?

13,211 people. But it's important to understand that not all of them are necessarily gambling addicts. For example, there are people who added themselves there as a preventative measure.