Russia’s legal online betting industry could be in for a shakeup as legislators announced plans to abolish the self-regulatory organizations (SROs) that represent licensed bookmakers’ interests.
On Tuesday, gambling affiliate Betting Business Russia reported that the Ministry of Economic Development was preparing legislation to abolish the country’s three SROs – two representing bookmakers and a third repping sweepstakes operators – due to the government’s belief that these groups are duplicating functions overseen by the Federal Tax Service (FTS).
While the Ministry’s anti-SRO push was met with pushback from the heads of the three SROs, the Ministry’s efforts are reportedly supported by the FTS, the Ministry of Finance and the Central Bank, suggesting that the writing may be on the wall for the relatively young SROs.
The two betting SROs – the First SRO of Russian Bookmakers and the Bookmakers SRO – were set up a few years ago, primarily to help prepare the ground for Russia’s licensed online sports betting regime. The SROs each run centralized online payment hubs, known as TSUPIS, through which all betting payments to and from customers must be handled in order to ensure the government’s capacity to monitor all online activity.
This year, Russia’s government promised to simplify the multi-stage process required to register with a TSUPIS, although the necessary legislation has yet to be approved. It’s unclear what the proposal to eliminate the SROs might mean for the TSUPIS arrangement.
Nikolai Oganezov, a former First SRO member and currently chairman of a bookmaking subcommittee of Russia’s Chamber of Commerce and Industry, called the government’s push to eliminate the SROs “very strange.” Oganezov said the government had advocated no system to replace the SROs, which would lead to “market chaos and the dissolution of the TSUPIS” system.
Russia currently has 16 licensed online betting operators, most of which enjoyed significant growth this year thanks to the Russian-hosted FIFA World Cup. Just last week, the Ministry of Finance proposed a new gambler self-exclusion program that would have required customers to submit their info to the SROs, which would then advise their members to stop accepting action from these customers.