Entertainment
Gambling business
* The calculations use average data for Russia
How are things going in the gambling business by the beginning of 2021, what are gambling zones like today, and are there any prospects for opening a casino in Russia? We’ll talk about all this in this article.
The gambling business, which was developing so rapidly in Russia until 2009, has undergone a significant transformation. First of all, it was caused by changes in legislation in the field of organizing casinos and slot machine halls. Let’s analyze what the industry managed to achieve by the beginning of 2021, but first, let’s understand the very concept of “gambling business.”
What is gambling business in general?
Gambling business in a broad sense refers to the activity of organizing any kind of gambling. That is, the main elements of this business are the bets that players place, the risk of losing the bet and the chance of winning an amount exceeding the amount of the bet.
As a rule, all types of gambling are divided into two main types: winnings in which depend on chance (slot machines, dice, etc.), and winnings in which depend not only on chance, but also on the skills of the players (for example, poker, sweepstakes) .
There are countless types of gambling around the world; it is pointless to list them all. Almost all countries receive significant income from this type of business. In many countries, gambling is allowed only in specially designated areas; as a rule, these areas are thriving from an economic point of view. Las Vegas is visited by about 40 million tourists a year; in the Chinese gaming center of Macau, the number of tourists reaches 30 million a year, which brings huge money to the budget.
In countries where gambling and casinos in particular are prohibited throughout the territory, this type of business does not disappear, but, as a rule, becomes criminal. For example, in Japan all types of gambling are prohibited, except for sports betting, lotteries and some national types of games.
Gambling zone "Golden Coast": will open in 2024
The Crimean gambling zone called Zolotoy Bereg, the construction of which will begin in 2021, will be opened in 2024 in the urban village of Katsiveli in Greater Yalta.
The dilapidated buildings of the Fortuna sanatorium, which was unfinished in Soviet times, located on the site allocated for the gambling zone will be demolished, and in their place a single complex will be built, including a casino, a hotel with apartments, restaurants, cafes, a summer theater, a cinema and concert hall, a conference hall, and open areas. , a network of internal automobile, bicycle and pedestrian promenades, places for sports, outdoor and indoor swimming pools, as well as a parking and transport service area.
The total investment in the gambling zone will exceed 3 billion rubles.
What is gambling business in Russia
Let's go back to the source. The Tax Code of the Russian Federation, Article 364, states that the gambling business is a business activity involving the organization and conduct of gambling, associated with the extraction of income by organizations in the form of winnings and (or) fees for gambling.
The gambling business exists in two main forms: in the form of casinos and in the form of bookmakers or sweepstakes.
Bookmakers and sweepstakes are allowed throughout the Russian Federation. They must act in accordance with the Federal Law of December 29, 2006 N 244-FZ (as amended on November 27, 2017) “On state regulation of activities related to the organization and conduct of gambling and on amendments to certain legislative acts of the Russian Federation.” The latest changes (as of December 2021) to this law have been made and come into force on May 27, 2018. This Federal Law defines the legal basis for state regulation of activities related to the organization and conduct of gambling on the territory of the Russian Federation and establishes restrictions on the implementation of this activity in order to protect the morals, rights and legitimate interests of citizens.
Please note that the organization of lotteries does not relate to the gambling business; their activities are regulated by the Federal Law “On Lotteries” dated November 11, 2003 N 138-FZ (as amended on March 7, 2018).
Classic gambling, by which we mean slot machines and casinos, is allowed only in special zones.
Gambling zone "Krasnaya Polyana"
Location: Sochi, Krasnodar region.
The decision to establish a gambling zone in Sochi was made after the 2014 Olympics.
On January 5, 2021, the opening of the Sochi Casino and Resort took place on the territory of the Gorki Gorod resort. On December 19, 2017, the Bonus Slots slot machine hall began operating. On January 4, 2019, the Boomerang casino opened in the gambling zone.
More than 1,600 employees work in gambling establishments in Krasnaya Polyana.
Gambling zones in Russia where all types of gambling are allowed
As mentioned above, in Russia all types of gambling are permitted only in specialized gambling zones. Federal Law 244-FZ explains in detail where and under what conditions such zones can be located. However, there is no point in a detailed consideration of all the necessary accommodation conditions, since the list of zones is strictly defined by law.
Currently, casinos are allowed on the territory of gambling zones that have been created in the following constituent entities of the Russian Federation: Republic of Crimea, Altai Territory, Krasnodar Territory, Primorsky Territory, Kaliningrad Region. Please note that no more than one gambling zone is created on the territory of one subject of the Russian Federation.
The situation in gaming areas by the beginning of 2021
- Republic of Crimea.
The gambling zone of the Republic of Crimea, according to the head of the Republic Sergei Aksenov, will begin operating in the fall of 2021. But to date, its location has not yet been clearly determined. Various options have been proposed and the current one may not be definitive. One of the biggest problems is the sectional regime established in relation to the Republic of Crimea. The implementation of such a project will require not only huge investments, but also certain experience, promotion technologies and management of such a complex. Domestic operators clearly do not have enough of all this, and foreign investors cannot legally enter this territory.
- Altai region
. Currently, a four-level gaming complex Altai Palace (Siberian Coin complex) operates in the Altai Territory. It includes a casino, hotel, restaurant, karaoke hall, SPA complex and a large open area for active recreation, as well as a summer concert venue. Most often, the complex is visited by residents from various regions of Siberia. The complex is located 288 kilometers from the capital of the Altai Territory, in the city of Barnaul. Over the nine years of its existence, more than 1.7 billion rubles of investment have been allocated to the development of this gaming zone. In 2021, almost 60 thousand people visited Altai Palace. An obstacle to the development of the “Siberian Coin” is the almost complete lack of necessary infrastructure and the low population density of the region. Tax revenues from this gambling zone for 2021 amounted to just over 31 million rubles, which is incommensurate with the investments made.
Photos and video materials from the official website of Altai Palace
- Krasnodar region
. The Azov City gambling zone is still located on the territory of the Krasnodar Territory, in which there are four casinos. Over the nine years of their existence, over a million people visited them. Total investments in the Azov-City organization exceeded 6 billion rubles. However, Dmitry Medvedev ordered the liquidation of the Azov City gambling zone in the Krasnodar Territory from December 31, 2018. According to experts, the Russian budget will spend about 10 billion rubles on compensation to investors. Instead of “Azov City”, a new gambling zone is being created in the region, which will be called “Krasnaya Polyana”, located near the city of Sochi. The closure of Azov City is due to the fact that, by law, only one gaming zone can operate on the territory of a constituent entity of the Federation. So far, there is only one casino operating in the new gaming area - Sochi Casino and Resort - and one slot machine hall. The total number of visitors to these establishments is still very small.
Photo: Royal Time Group
Photo: Alexey Ovchinnikov
- Primorsky Krai.
The launch of the Primorye gaming zone, located in the Primorsky Territory, in Muravyina Bay, took place in October 2015. The first casino that opened in this gaming zone was the Crystal Tiger, or in the French manner, Tigre de Cristal. Currently, this gambling establishment and hotel remain the only ones operating in the seaside gambling zone. The zone is located 50 kilometers from Vladivostok. Two more sites are planned, which according to the plan should welcome tourists in 2021. In two years, the casino received more than 850 thousand visitors, about 80% of whom were residents of China. The infrastructure of Primorye has not yet been completed and is in the process of development.
Photo: official group of Tigre De Cristal casino VKontakte
- Kaliningrad region
. The Yantarnaya play zone is located in the Kaliningrad region. The planned amount of investment in it will be about 45 billion rubles. The first MAGIC CRYSTAL slot machine hall on the territory of the Yantarnaya gambling zone began operating in 2021. Currently, the complex operates the only casino “Sobranie”, a conference center, a walking area and a hotel. The gaming zone is located 35 kilometers from Kaliningrad. Plans for the development of the zone are very large, but everything depends on the lack of foreign investors who could help set up business processes correctly.
Photo: official group of the Sobranie casino on VKontakte
Gambling zone "Yantarnaya"
Location: Kaliningrad region.
The Yantarnaya gambling zone operates in the area of the Kulikovo village in the Zelenograd region. In 2009, an area of 480 hectares was allocated for a gambling zone. Six years later, by government order, it was reduced to 99.5 hectares.
The first facility of the gambling zone, the Magic Cristal slot machine hall, was opened on April 8, 2021 . It has 139 slot machines.
On February 10, 2021, the Sobranie casino was opened on the territory of the gambling zone. The area of the gambling establishment is 18 thousand square meters. meters. It has 13 gaming tables and 312 slot machines.
In July 2021, it became known that the government of the Kaliningrad region completed the division of land in the gambling zone and registered ownership of 39 newly formed plots.
In April 2021, a decree of the government of the Kaliningrad region was published on the official Internet portal of legal information, according to which an auction should be held for the right to conclude lease agreements for six land plots.
Plots with an area of 14,420 sq.m. are offered for rent for 58 months. up to 50,490 sq.m. Hotels should be built on four sites along with the casino (one three-star and five-star, and two four-star). On one site, the casino should be supplemented with a retail facility, and on another site, no additional facilities need to be built along with the casino.
Online casinos in Russia – legal or not
According to experts, the online casino market in Russia is about $1 billion a year, and more than $45 billion worldwide.
The prohibition on carrying out activities related to organizing and conducting online casino gambling is contained in paragraph 3 of Art. 5 of the Federal Law “On state regulation of activities related to the organization and conduct of gambling...”. Violation of these legal norms provides for criminal and administrative liability. Currently, the Federal Tax Service, Roskomnadzor or the Prosecutor General's Office are authorized to make decisions to block a gambling site without obtaining a court decision.
On May 26, 2021, certain provisions of the Federal Law of November 27, 2021 No. 358-FZ “On Amendments to the Federal Law “On Lotteries” and the Federal Law “On State Regulation of Activities for the Organization and Conduct of Gambling and on Amendments” came into force in some legislative acts of the Russian Federation”, which prohibit banks and payment systems from transferring funds between individuals and illegal gaming sites.
The fine for organizing online gambling is up to 1 million rubles and provides for imprisonment for up to six years. You can’t even advertise gambling, the fine is up to 500 thousand rubles.
Thus, there is a complete ban on the operation of online casinos in Russia. In practice, implementing such a ban is quite difficult. A modern information system allows you to bypass any site blocking with minimal skill, and various payment and withdrawal systems provide users with every opportunity for almost any transaction.
Out of the game
A holy place is never empty. If in other cities gambling establishments were officially closed, then in their place “Internet clubs”, “lotteries”, online casinos, and bookmakers appeared - both legal and illegal. And some owners of gambling clubs have taken their establishments underground. Reports periodically appear in the media about how operatives raid one or another club. Sometimes law enforcement officers also help such “underground workers.” As Realnoe Vremya reported, in March the former head of the Russian Ministry of Internal Affairs for Izhevsk, Alexander Nikitin, was detained, who was accused of “committing crimes under Part 5 of Art. 33, part 3 art. 171” (assistance in organizing and conducting gambling using gaming equipment outside the gambling zone), as well as Part 1 of Art. 285 (abuse of official powers). Our online newspaper also reported on the case of a Chelny IT specialist who was suspected of creating the online casino Azino777.
By the way, they wanted to build their own Las Vegas in Tatarstan - in the village of Kamskie Polyany, where a nuclear power plant was to be built. In 2006, the republic adopted the law “On the placement of gambling establishments”. And 200 km from Kazan, casinos began to open (there were 16 of them in total), some infrastructure began to develop, until a federal law was adopted. In 2009, Kamskie Polyany was included in the list of single-industry towns in Russia and received 1.7 billion rubles for the construction of an industrial park and a medical center. Despite all efforts, the village maintains the highest unemployment rate in Tatarstan.
They also wanted to build their own Las Vegas in Tatarstan - in the village of Kamskie Polyany, where a nuclear power plant was to be built. Photo vk.com
As for the aforementioned Royal Time Group, the company has now been declared bankrupt. The holding of Rashid Taimasov was presented with demands for more than a billion rubles. "Royal Time Group" is one of the most prominent defendants in the bankruptcy case of "Tatfondbank" and those associated with it from Kazan, Realnoe Vremya wrote in detail.
Timur Rakhmatullin
BusinessSocietyHistory Tatarstan
Prospects for the development of gambling business in Russia
The development of the gambling business in the Russian Federation is primarily hampered by the poorly developed legal framework for its functioning. In particular, from January 1, 2021, tax rates on the gambling business have been doubled, or rather their minimum and maximum limits, within which the regional authorities themselves determine the specific rate.
The Ministry of Finance of the Russian Federation plans to gradually increase tax rates on the gambling business for all objects of taxation by 10 times, as well as introduce new objects of taxation within the gambling business.
International sanctions that make it difficult for foreign investors to come to Russia, who can bring not only the necessary investments, but also technologies, will not be lifted in the foreseeable future. Moreover, a significant tightening of sanctions is possible, which will further limit the participation of foreign operators in the development of the gaming business in Russia.
The constant decline in real incomes of the population, which has continued since 2014, contributes to a decrease in the profits of the gambling business. The lack of infrastructure and low population density near gaming zones allocated for organizing the gambling business increase investment risks for investors. In addition, we should not forget about the large number of illegal online casinos, which we have not yet been able to combat.
Thus, the prospects for business ideas for opening a casino in Russia are very doubtful, which is confirmed by the near-zero dynamics of development of existing gaming zones over the past nine years.
Anton Vodolazov
, business consultant, candidate of economic sciences Contact the author (c) www.openbusiness.ru - portal of business plans and guides for starting a small business
01/25/2019
All materials by tag: casino
Save the article to study the material carefully
Remember article
You can save this page using:
Profitability of existing gambling zones
- Primorye - Every year, a hotel with a casino brings almost half a billion rubles to the state budget. More than half of this amount goes to the budget of Primorye, which is 9% of the total amount of taxes in the regional budget.
- Krasnaya Polyana - In 2021, the gambling zone transferred 462.7 million rubles to the Kuban budget. Compared to 2018, when the Azov City gambling zone was still operating, revenues decreased by 243.4 million rubles or 40%.
- Siberian coin - In 2021, residents of the gambling zone paid more than 62 million rubles in taxes to the budget.
- Yantarnaya – In 2021, the volume of gambling tax payments amounted to about 80 million rubles.
Opening a casino on the Internet
A significant part of Internet users, which is about 5 billion people, one way or another, like to take risks by gambling.
Without leaving home or office, visitors to online casinos spend thousands on such pleasure, and some even lose entire fortunes, which categorizes online casinos as the most profitable areas of business. An entrepreneur will face competition in the segment of activity under consideration, so he will have to invest a lot of effort and money to ensure that the online casino is in demand among users.
Stages of opening an online casino:
- purchasing a license for this type of activity;
- conducting market analysis and identifying empty niches. On many sites you can play cards or roulette, but there are no slot machines;
- purchasing hosting. When dealing with money, take care of security and 24/7 access to the site. Consider options for protecting the service from hacker attacks and hacking;
- purchase of gaming programs - software. You can borrow ideas from existing gaming machines, but it’s a good idea to think about an individual gaming design. The essence of the game is always the same, but the animation used and the variety of bonus stages arouse the player's interest;
- connection to the payment system. The more options for paying a gaming account, the higher the likelihood of keeping a player on the site. Establish cooperation through technical support of the system.
Do not spare money on a specialist in the field of web design and programmers. Failures cannot be ruled out, and lost time means lost income and loss of customers.
The goal is to earn money, which means that players will lose and, as a result, react emotionally to failures. Combined with system failures, losing a player is a matter of just a few minutes.
Is the online gaming business legal?
Online analogues of classic gambling - in the form of virtual casinos and slot machines - are prohibited in the Russian Federation (Clause 3, Article 5 of Law No. 244-FZ). In addition, the Supreme Court of the Russian Federation, in its ruling dated October 9, 2012 in case No. 91-KGPR12-3, established that Russian providers are obliged to block sites that offer users to play in the appropriate format.
In turn, betting shops and bookmakers can operate online as interactive betting operators. In other words, accepting funds electronically and paying out winnings also via the Internet, when using processing centers (clauses 3.1, 25, 26 of Article 4 of Law No. 244-FZ).
License
Unfortunately, obtaining a license in Russia is impossible, since gambling is officially prohibited in the country (with the exception of five regions). The legal solution in such a situation is to purchase an offshore permit. You can purchase a license in the following countries:
After obtaining a license, organizing a casino or bookmaker's office (including on the Internet) will be completely legal. Obtaining a permit is not a cheap procedure, but without it it is difficult to recruit clients and further promote the business.
