ANNOUNCEMENT
Regarding the Draft of the Proposed New Changes in the Gambling Sector
The National Association of Gambling Operators NGO (NAGO), while recognizing the importance of responsible regulation of the gambling sector, combating gambling addiction, and protecting socially vulnerable groups, would like to present its position regarding the legislative initiatives currently under discussion in the National Assembly of the Republic of Armenia.
We understand and share the concerns related to the social consequences of gambling addiction, financial hardship among citizens, and the potential misuse of state support funds for betting activities. At the same time, we believe that any regulatory framework must be based on realistic assessments, technical feasibility, and balanced policymaking in order to avoid creating new and potentially more dangerous risks.
The proposed amendments introduce an irrevocable five-year self-exclusion mechanism and additional restrictions targeting certain social groups. However, the unified regulatory system necessary to ensure simultaneous exclusion across all licensed platforms has not yet been implemented. In addition, circumstances, there is a real risk that affected individuals will simply migrate to unlicensed or foreign platforms operating outside the scope of Armenian regulatory oversight.
Over the past year, due to severe restrictions and the increased tax burden, the black market has already doubled — rising from 10% to 20%. Blocking such a large number of individuals from licensed platforms could drive this figure up to 50%. Similar growth in the black market as a result of stricter restrictions has been observed in developed countries such as Germany, Czech Republic, Sweden, and others.
We are also concerned that the rationale behind the selection of the targeted groups has not been sufficiently substantiated through publicly available data or professional analysis. It remains unclear on what statistical or analytical basis groups such as mortgage subsidy beneficiaries or individuals with certain income structures were selected.
The draft creates the impression that its objective is to block the maximum possible number of citizens from licensed platforms, thereby driving them toward the black market and increasing criminal activity, including the spread of “street” betting and cash-based betting through accounts registered in the names of other individuals.
It is also important to distinguish between social assistance programs and income tax refund mechanisms, as they serve fundamentally different policy objectives. While social assistance is intended to address essential social needs, income tax refund programs are designed, among other things, to stimulate economic activity and support the development of the construction sector.
At the same time, the proposed reliance on declared income as a criterion for restriction may lead to disproportionate and ineffective limitations. Many citizens may possess legitimate income and financial resources without being subject to mandatory income declaration requirements. As a result, such individuals could be excluded from licensed platforms and unintentionally redirected toward unlicensed operators.
Consequently, the proposed restrictions may affect not only socially vulnerable groups, but also middle- and high-income citizens, while the connection between the stated policy objectives and the proposed enforcement mechanisms remains insufficiently substantiated.
At the same time, we consider it necessary to address certain public statements currently circulating in the public discourse. When it is stated from the National Assembly podium that Armenian citizens have “lost” AMD 7.4 trillion (approximately USD 20 billion), such wording is misleading, as this figure does not represent losses, but rather the total volume of bets placed. Under Armenian law, at least 90% in aggregate this amount is returned to players in the form of winnings.
Globally, betting turnover is not considered an indicator of actual player losses, precisely because the overwhelming majority of wagered funds are returned as winnings. In Armenia, this return rate actualy is over 95%. Furthermore, these figures are verifiable and documented. During the parliamentary committee hearings preceding the National Assembly session, representatives of the State Revenue Committee explicitly stated that the actual difference between inflows and outflows amounts to approximately AMD 150 billion—not AMD 7 trillion.
We therefore urge all stakeholders to refrain from exaggerated or manipulative interpretations of the sector’s indicators, particularly from politicizing the issue, as such approaches do not contribute to a professional, evidence-based, and balanced discussion.
It is noteworthy that during parliamentary discussions, the State Revenue Committee also highlighted the risks of black market expansion, emphasizing that overly restrictive measures may result not only in fiscal losses, but also in the weakening of player protection mechanisms.
We reaffirm that regulation of the sector should be implemented through a phased, technically feasible, and balanced approach, including:
- effective measures against unlicensed platforms,
- genuine player protection mechanisms,
- promotion of responsible gaming culture,
- evidence-based policymaking,
- and cooperation between public and private stakeholders.
We call for broad professional consultations prior to the second reading of the draft legislation, involving state authorities, professional associations, representatives of the financial sector, international experts, and civil society organizations. The Association had also proposed holding a discussion on this issue prior to the first reading, but the proposal remained unanswered.
We are convinced that only balanced and practical solutions can effectively protect citizens while preventing the expansion of the black market and the loss of regulatory control.
The National Association of Gambling Operators NGO (NAGO)
