Gambling in Eastern Europe: Features and Development Prospects

Updated 21 august 2023
Online casino, Land-based solutions, Licensing
Author: James Burton
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Experts of the Casino Market company will tell you about the state of affairs in the Eastern European entertainment market. You will learn about the benefits of investing in the niche, promising business areas, and expected changes in the regulatory framework.

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Evolution of the Industry in the Region

Gambling in Eastern Europe

For over 30 years, the gambling sector has experienced its ups and downs.

In some jurisdictions (for example, in the Baltic region), the industry has been flourishing for many years, while in others (Kazakhstan), it is in its infancy.

Key features of the Eastern European market:

Different approaches to legalisation

The area is characterised by frequent changes in legislation.

In Ukraine, for example, the gambling sector flourished until 2009. Then, for 11 years it was banned, until July 2020, when the government presented a new bill.

A similar situation takes place in other countries as well

Huge potential for growth

The local market opened much later compared to Western Europe. So it is not yet oversaturated with gambling companies. There are no obvious monopolists here.

All brands have equal conditions for starting and scaling their businesses

Developed IT sector

Programmers, web developers, and motion designers from Ukraine, Georgia, and other countries of the region are highly valued in the international labour market.

The region has a good IT infrastructure, reliable 4G and 5G coverage, modern data centres, and large IT hubs

An active fight against ludomania

One of the reasons for the frequent changes in the local legislative framework is the growth of the number of people suffering from gambling addiction. In the 2000s, the authorities of many countries prohibited the placement of bids. It has become an impetus for the rapid development of the grey market.

In the 2020s, seeing the mistakes of their predecessors, the government legalised betting but with significant restrictions. They are aimed at protecting socially vulnerable persons (minors and low-income citizens) by informing them about the risks of gambling

The legalisation of casino entertainment, human resources, and high interest in the niche among the locals contribute to the increase in the number of providers in the region.

The following world’s leading software vendors have already managed to open representative offices in Eastern Europe:

  • Skywind Group (a provider of iGaming solutions and casino platforms) has an office in Ukraine.
  • Tom Horn Gaming has a strong presence in the Baltics.
  • The BGaming development department is located in Georgia, while the finished products (content and gaming systems) are operated from the brand’s main office in Malta.


The local casino industry was legalised in July 2020. Before that, it was strictly prohibited.

Features of the Sector

How the entertainment niche in this country:

  1. The legality of all types of gambling. Entrepreneurs can launch an online casino, a land-based location with slot machines, a bookmaker's office, or a poker room.
  2. Licence for each type of activity. Its issuance is handled by CRAIL — the Commission for the Regulation of Gambling and Lotteries. The document is valid for 5 years. The cost of the fee depends on the type of provided products. Operators need to obtain additional permits for each equipment unit to place gaming tables or slots in an offline casino.
  3. Emphasis on responsible gambling. Persons under 21 years old, low-income, or incapacitated citizens, and those who have previously included themselves in the self-exclusion list, cannot enter venues of such type. Entrepreneurs are required to implement responsible gambling mechanisms (time counters, bet limits, etc.).
  4. Transparent work of operators. It is planned to connect all casino websites to the state’s online monitoring system. The service will control the completeness of the payment of winnings, the timeliness of the deduction of taxes, and other mandatory actions.

Prospects in 2023

A full-scale invasion slowed down the development of the gambling industry. To minimise the negative impact of the war, in March 2022, the authorities reduced the income tax to 2%. About 80% of entrepreneurs working in the market took advantage of fiscal facilities.

The benefit was cancelled in the summer of 2023. The business returned to the previous taxation system. The new bill has been criticised by those entrepreneurs who already pay the highest licensing fees in Europe.

Despite all the difficulties, the Ukrainian gambling market continues operations and demonstrates good potential for scaling.

Key indicators of the industry’s growth:

  • legalisation of cryptocurrency in March 2022;
  • introduction of the concept of Open Banking and development of progressive fintech products;
  • facilitation of communication with the state due to the Diia legal initiative.


Gambling development in the Baltic countries

Estonia, Latvia, and Lithuania are examples of countries with a reasonable approach to gambling regulation, attraction of foreign capital, and support for domestic operators.

The grey casino market in the Baltics was eliminated thanks to the balanced policy of the local authorities in the early 2000s. After that, licensed entrepreneurs with a responsible attitude toward entertainment for money began to appear.

Advantages of Working in the Region

Let us consider why investors choose the Baltic countries:

Transparent regulation

The jurisdiction has support from official bodies.

Latvia, for example, was one of the first to legalise all types of gaming. The Gambling and Lotteries Law was passed in 2005. The document streamlined the work of offline and online operators, which was an important innovation.

Currently, most of the legal acts have been adapted to EU requirements. The law protects all market participants — investors, operators, and users

Simplified launch of an iGaming startup

Latvia and Lithuania recognise certificates issued by other regulators. The operator needs a local permit to implement a gambling project in Estonia.

The authorities treat the illegal casino business with all the severity. The government instantly blocks access to the platforms of offshore operators who try to accept bets without authorisation

Low taxes

Estonian entrepreneurs pay only 5% of NGR (Net Gaming Revenue). This tax must be paid monthly.

The fiscal rate in Lithuania is 10% of GGR (Gross Gaming Revenue)

Good business environment

The Baltics are distinguished by a solid labour market, a competitive level of wages (compared to Western Europe), and a loyal fiscal burden. Thanks to this, many progressive casino brands have appeared in the region. They create content for online platforms, betting sites, and other popular solutions.

Such well-known providers as Betgames.TV, Evolution Gaming, Playtech, Tom Horn Gaming, and many others work in the Baltics

Key Challenges for Operators

The crisis caused by Covid-19 had harmed the casino industry:

  • Latvia suffered the most, losing 45.5% of revenues in the gambling niche.
  • In Estonia, funding for several healthcare initiatives was cancelled due to low revenue generation.
  • Lithuania emerged from the crisis with minimal losses due to the balanced policy of the authorities.

The land-based sector has not yet fully recovered from the consequences of the pandemic, while the online direction is showing stable growth.

The Baltic countries have the harshest advertising restrictions in the EU. In Latvia, there is a complete ban, while in Estonia and Lithuania, it is allowed to show such video clips only at night (from 10 pm to 5 am).

The plans of the Lithuanian regulators include an increase in the cost of licences. So far, the changes are being discussed at the state level and with the relevant committees. If the proposed amendments come into force, the price of an online casino certificate will reach €500,000.


The local market flourished in the early 2000s. The authorities carried out several liberal reforms. They had impacted positively on all sectors of the economy, including gambling.

Reduction of taxes, simplification of the licensing, and introduction of a transparent tendering — these and other factors have made the industry attractive to foreign investors. Tourism has become the catalyst for the growth of the sector. Such international hotels as Hilton, Radisson, and many others that had halls with slot machines were opened in Georgia.

Over 20 years, the casino and tourism industries in the country have developed together. Taking advantage of the ban on gambling in Turkey and Ukraine, Georgia has opened the largest entertainment complexes in Batumi. The city has become a centre of attraction for foreign players from all over the coast of the Black Sea.

Advantages of Working in the Local Market

The main benefits of launching an iGaming startup in Georgia:

  1. A single regulation centre. The permit issuance and renewal, the formation of tax policy, the resolution of disputes between users, and other functions are assigned to the Georgian Revenue Service. Its work is based on the law on the organisation of lotteries, entertainment, and profitable games of 2005.
  2. One licence for all activities. The document is valid for 5 years. Entrepreneurs can open a poker room, an online casino, a land-based bookmaker's office, or a website for selling lottery tickets.
  3. A simple permit issuing procedure. The application can be filed electronically on the regulator’s website. The review period is 20 calendar days. Operators pay the state duty and a quarterly business service fee if the answer is positive. This is €10.5 thousand for online casinos. For a location with slot machines, it is €3.5 thousand.

Changes in the Regulatory Framework

At the beginning of 2022, a new gambling law was adopted.

The main provisions of the document:

  • increase in the age requirement from 18 to 21 years;
  • a ban on advertising bookmakers’ services in casinos and betting shops;
  • introduction of higher taxes (for example, 10% from each promotional draw or 20% from each tournament fee);
  • mandatory audit of iGaming platforms, etc.

The local market reacted to innovations ambiguously. The increase in fiscal rates and the complete ban on advertising were difficult for entrepreneurs to accept. Many companies have revised their budgets, cutting costs for bonuses and other types of rewards.

Despite changes in legislation, Georgia remains one of the most attractive countries for the gambling niche in the Black Sea basin. It outperforms the competitors thanks to a stable political environment, a loyal attitude towards casino entertainment, and well-developed tourism.

The main task of the authorities is to reduce the level of distribution of ludomania. This disease is called the social plague of the state. That is why the government plans to continue introducing various restrictions (bans on bonuses, limits on bets, etc.).


Only a minor part of this Central Asian country is located in Europe, which does not diminish its role in the growth of gambling in the region.

There are 2 entertainment zones with land-based halls with slot machines, betting shops, and sweepstakes:

  • Kapchagai (the coast of the Kapchagay reservoir in the Almaty region);
  • Borovoe (the Shuchinskiy district of Akmola region).

There are many 5-star hotels with casinos, recreation areas, lounge bars, sports pubs, and shopping centres.

Gambling zones attract tourists and players from neighbouring countries, which provides a stable replenishment of the treasury. Kazakhstan is visited by customers from Uzbekistan, Azerbaijan, Tajikistan, and Kyrgyzstan because money games are prohibited in these jurisdictions.

The web entertainment sector operates in a grey zone. The government does not forbid the acceptance of digital bids, but the industry is not regulated. Users can play in offshore casinos and safely withdraw prizes to local bank cards.

The Kazakhstan market is in its infancy. The development of clear and transparent legislation will attract multimillion-dollar investments into the online sphere. The country has a favourable geographical position. It is open to tourists from Europe and Asia, which is good given that gambling is prohibited in almost all neighbouring regions.


The casino niche was legalised in the early 2010s. Since then, it has been actively developing and flourishing: new hotel complexes with gambling halls appear constantly, and customers willingly place online bets.

Benefits of working in Armenia:

  1. Stable political and economic environment. The state has close ties with the EU per the European Neighbourhood Policy. Besides, the country actively cooperates with Kazakhstan and has been a member of the Eastern Partnership since 2009.
  2. Developed gambling. The region quickly recovered from the crisis caused by Covid-19. The main reason is a dynamic iGaming sector, which, like the land-based niche, brings multimillion-dollar revenues to the public treasury.
  3. Fast acquisition of the licence. The application is considered by the local authorities during 20–30 calendar days.

In recent years, the actions of the Armenian government have aimed at tightening the gambling policy:

  • In 2022, the regulator banned casino advertising. Marketing materials cannot be placed on radio, television, or the Internet.
  • On July 1, 2023, a new law came into force and increased licence fees for owners of online casinos and bookmakers’ offices.

Following the example of Kazakhstan, the authorities plan to create dedicated gambling zones.

Large casino complexes will be located in Tsaghkadzor, Sevan, Jermuk, and Meghri. Such changes are caused by the government's desire to attract more foreigners and tourists, thus reducing the level of ludomania among Armenians.

The Main Things about the Development of Gambling in the Region

Gambling development in Eastern Europe

Eastern Europe is a promising market for those willing to invest in the casino sector.

  • The jurisdiction has different approaches to the legalisation of the industry and the scaling of the IT sector. There is still low competition among entrepreneurs, which provides an additional incentive for the growth of this type of business.
  • Only land-based casinos and betting shops are allowed to operate in Kazakhstan. The acceptance of bids is limited to two gambling zones where customers are offered slot machines and sweepstakes.
  • The Ukrainian gambling industry is not in the most advantageous position due to the military and political situation in the country. More than a year ago, a simplified taxation system with reduced fiscal rates was implemented in the jurisdiction. The legalisation of cryptocurrency and the concept of Open Banking introduction also have positively affected the growth of the niche.
  • The Baltics are considered the leader in Eastern Europe in terms of the attracted investments, the number of opened online casinos, and content development studios. Estonia, Latvia, and Lithuania can be characterised by balanced legislation, low taxes, and simplified access to the iGaming market.
  • The entertainment sector in Georgia is closely related to tourism. These two industries bring multimillion-dollar revenues to the treasury in duties and fees. Thanks to its good geographical position, the country attracts a lot of players from Turkey, Bulgaria, and Romania.

You can order a turnkey iGaming platform from the Casino Market studio. We can implement a project of any complexity level and help you with the acquisition of a licence and the installation of payment services or other software.

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