More and more countries are considering legalizing the gambling industry. In late 2019, the government of Uzbekistan decided to legalize the sportsbook business to boost the country’s sports industry.
After a long wait, the legislation is soon to come into effect — but players are never very patient.
The background
In November 2019, the presidential decree “On measures to bring the football development in Uzbekistan to a new level” was published on the portal of the government of the Republic of Uzbekistan.
The decree directly involved the sports betting sector: it declared that the sportsbook industry would be legalized in order to invest the tax revenues from betting businesses in the development of the country’s sports institutions (mainly football).
The corresponding bill was expected to be written and approved within a few months and legal framework and the addition of new regulations to the legislation are projected to come into effect in 2021.
As usual, the legal status of betting doesn’t impact players’ appetite for it. Without local options, Uzbek players have become very active on offshore casinos and sportsbooks. With the market due to open soon, offshore operators and domestic entrepreneurs are faced with an incredible opportunity to get a head start on iGaming’s latest emerging market.
The goals of the betting business
There are several reasons the government came to consider the betting business as a potential source of revenue. Two of them stand out. The first is the effort to fight the outflow of revenues towards the black market, and the second is the Football Federation of Uzbekistan’s need for financial support in order to achieve success in the international arena.
Initially, it was claimed that operators would need to get a special license, which, according to various sources, would be issued by the Capital Market Development Agency. As mentioned above, based on the initiative, a certain percentage of the sector’s revenue would be directed to the state budget.
It is just as important to note that the development of the betting market is expected to bring new sponsors and new financial investments to the sport. At the same time, there is as of yet no information regarding licensing for foreign companies.
Also under discussion were some regulations to promote responsible gambling. For example, there were plans to establish restrictions regarding the size of bets, as well as to limit the number of straight lost rounds.
At the time of this writing, bookmaking activities in Uzbekistan, as well as the whole gambling industry (with the exception of state lotteries), remain prohibited — at least until the expected legislation is passed.
Gambling legislation Uzbekistan
KEY DATES
- 1991 | Ban on gambling activities
- 2003 | Resolution No. 314 “On Licensing Organization Lottery Activities”. A state fee, 35 minimum wages, is charged for the issuance of a license.
- 2007 | Resolution of the President of the Republic of Uzbekistan No. PP-608 “On measures to suppress illegal activities related to the organization and conduct of gambling”
- 2019 | Plan to re-regulate sports betting announced
The Muynak gambling zone
In 2019, there was a promising sign for the gambling industry in Uzbekistan after officials announced a resolution to develop the country’s economy by expanding its tourism industry. In light of the announcement, authorities planned to establish a legal gambling zone in Muynak, a well-known tourist destination.
According to the original plans, Muynak would have been transformed into a modern entertainment and tourism cluster by the end of 2020.
The project included the creation of an independent administrative unit, which would consist of several hotel complexes, a shopping mall, gambling halls, poker rooms, and other forms of gambling entertainment. The gambling zone is intended exclusively for foreign citizens.
In this specially designated space, the government of Uzbekistan intended to organize several business areas for:
- Sport (a track might be built for the Rally Muynak)
- Trade
- Religious tourism
As of yet, there is not much information available; the government of Uzbekistan has not recently given any comments or disclosed any new details on the issue. However, while officials haven’t announced many updates on the progress of the legislation, it hasn’t been publicly cancelled, either.
It is highly likely that a gambling zone in Muynak will be built sooner or later. However, delays should be expected, and construction may only be finished after the introduction of amendments to current legislation.
Uzbek sports bettors aren’t waiting for new regulations or a gambling zone; they already frequent offshore casinos. Given that the market is due to open soon, with legislation planned for this year, both domestic entrepreneurs and offshore operators can get ahead of the curve by launching a new platform or expanding their current offering.