Ukraine launches state lottery licence competition in major market overhaul

Ukraine has opened a competition for state lottery licences as part of a sweeping reform of its gambling sector, seeking to end more than a decade of grey-market operations and strengthen tax oversight during wartime.

PlayCity, the regulator that replaced KRAIL earlier this year, launched the tender on 1 December. Applications are open until 29 December 2025, a shorter window than the 60-day period initially expected, reflecting a trend toward tighter timelines in recent government procurement rounds.

For the past 12 years, Ukraine’s lottery industry has operated without a clear regulatory framework, with companies running state lotteries without contracts, paying no licence fees and facing little tax scrutiny. Under the new rules, only licensed operators will be permitted to issue and conduct state lotteries.

The Ministry of Digital Transformation is placing digitalisation at the centre of the reform. The framework mandates real-time tracking of ticket sales and winnings, electronic reporting of all transactions and unique QR codes on every ticket and terminal to verify legality and point of sale. First Deputy Prime Minister Mykhailo Fedorov previously confirmed the push toward digital oversight after discussions with President Volodymyr Zelensky.

The government said the shake-up aims to improve transparency, ensure tax revenues and curb corruption and illegal activity. New rules approved on 19 November require licensed operators to pay taxes and fees and guarantee players fair draws and real winnings. All operators must connect to a real-time monitoring system.

Companies applying for licences must have at least three years of experience in the lottery market, a website in the .ua domain and authorised capital of at least 30 million hryvnia ($711,335). Firms linked to the aggressor country are barred from participating.

Prime Minister Yulia Svyrydenko has confirmed that three winners will be selected, each paying an annual licence fee of 22.4 million hryvnia ($531,130). A list of winners will be published within 15 working days of the deadline, with successful bidders given 10 days to obtain their licence and pay the fee.

The current rules will remain in force for the duration of martial law plus one year, but not less than three years. The government’s next step will be to amend the Law on State Lotteries, which currently allows the three existing operators to continue operating for another decade with limited oversight.

Officials say the goal is to create a competitive, transparent market and end the dominance of legacy schemes. “The time for us to start a market where the initial conditions are the same for all is finally here,” said Natalia Denikeeva, Deputy Minister of Digital Transformation. “A competitive environment is established around that — one in which old schemes will not continue to win, but quality, technology and compliance with the law.”

Announcing the tender, she added: “We are launching a market with equal conditions for everyone. It is not access to old schemes that wins, but product quality, technological sophistication, and compliance with the law.”