- ‘Gray area’ countries
- Online and offline gambling in Russia
- History of gambling in Russia
- Gambling in the late 1980s and during the 1990s
- Gambling during the 2000s
- A government sanctioned internet ‘blacklist’ in Russia
- International gambling sites
- Legal gambling zones
As online gambling has spread around the world, many countries seem to have been caught off guard by its proliferation. For that reason, it is very common to find that countries do not have any laws related to the subject. Online casinos and betting sites continue to be used in ‘gray area’ countries like these, to the detriment of the country in question. Citizens of countries without regulation continue to gamble online, but their country does not benefit from increased tax revenue or employment. Russia is certainly not a country with any gray area regarding gambling legislation. Instead, the situation in this giant country is very clear.
In Russia, all forms of online gambling have been made illegal, while offline gambling is permitted in just four states. To see how Russia arrived at this situation, it is necessary to take a look at its history.
Gambling has long been popular in Russia and thrived during the time of the Czars. However, this was to change when the ruling classes were overthrown, and the Communist era began. In 1928 all forms of gambling were made illegal and stayed that way for as long as the Communist party held sway in the country. These measures were taken due to fears that gambling encouraged illegal behaviour which had a negative impact on society as a whole. Of course, people still continued to gamble, but only in low-key and localised betting games between friends and in local areas. This state of affairs continued all the way up to the end of the 1980s, when a new change was to take place.
In the late 1980s gambling was made legal once again, in tandem with the fall of Communism. In 1988 slot machines were permitted to be installed in hotels in some areas, and in 1989 gambling was fully legalised across the country. It did not take long before the first casino opened in Moscow, to be followed by many more opening all over Russia. Soon Moscow alone boasted over 50 casinos, and gambling had become hugely popular. As western ideas spread to Russia, games like poker started to be widely played. Previously, games of poker had taken place in Russia but only in private residences or salons. Now this game moved into the open, although attempts to run tournaments during the 1990s were still largely unsuccessful. However, gambling was spreading like wildfire across the country, but the industry was virtually completely unregulated. Obviously, this gave room for criminality to flourish, and offered no real protection to Russian gamblers. The government was becoming more and more unhappy about this state of affairs, and after 20 years of gambling the party would soon be over in Russia.
The first major government intervention took place in 2004, when a law to impose taxation on gambling was introduced. This law was quite complex, but basically it allowed each region to determine how much tax to impose on gambling. In 2006 all forms of online gambling were banned outright in Russia, with no exceptions. If you are looking for clarity when it comes to gambling legislation, then it does not get much clearer than this. In 2009 offline gambling was made illegal everywhere except for four designated gambling zones: Kaliningrad Oblast, Azov-City, Altai Krai and Primorsky Krai. Now if you wanted to gamble in Russia you could visit one of the four gambling zones, or of course you could continue to use international online gambling sites. Most online casinos and sports betting sites continued to offer their services in Russia long after the 2006 law came into effect. Many of them offered Russian language versions of their websites and accepted Russian currency.
As many governments in countries around the world have discovered, it is extremely difficult to stop people from using international sites to gamble on. Trying to criminalise players is both extremely difficult, expensive and very unpopular, meaning that this policy is rarely attempted by governments. In countries like the United States an alternative policy was introduced, making it illegal for banks to fund online gambling sites and also prosecuting companies for continuing to operate illegally in that country. The Russian government took another approach – one that has been adopted by countries like Indonesia – and which has also proved to be successful. There was already a government sanctioned internet ‘blacklist’ in operation, which was used to ban sites which were regarded as morally abhorrent. The definition of which sites were offensive to the public has proved rather flexible over time, and in 2012 all gambling sites were added to this blacklist. Internet providers were instructed to block these sites, and many international betting companies ceased trying to attract customers from Russia.
Of course, there are those betting sites which have managed to slip through the net and still try to incentivise Russian players to bet with them. In 2017 it was estimated that about a million and a half Russians continued to bet online via international companies. It is difficult to obtain accurate figures though, and it may well be that this number is a considerable under-estimate of the actual online gambling population. It is difficult to gamble online in Russia due to the major sites having been blocked, but it is not impossible to do so. There is also some confusion regarding the status of poker, because it can be considered a game of skill rather than one of chance, with the latter being explicitly outlawed.
Russians can still choose to visit one of the four legal gambling zones, although given the vast size of the country this is not an option available to everybody. Zones like that in Primorye, Siberia hope to create an eastern ‘Las Vegas’. This area specifically hopes to target Asian gamblers and attract them across the border to gamble in Russia. The taxes imposed will help the struggling region, and of course the increased employment opportunities are also a bonus. The status of online gambling seems unlikely to change in the near future barring a change in government, but as always, where there is a will there is a way!