Illegal lottery advertising in Ukraine: why gray gambling advertising has not disappeared anywhere

The legal gambling market in Ukraine is in difficult conditions, facing pressure from illegal operators, including lottery operators operating outside the law.

Our editors tried to examine in detail the problem of illegal advertising of lotteries in the country and the pressure it puts on legal market participants and the state budget.

The problem of advertising illegal lotteries

“The Law on Amendments to Certain Legislative Acts of Ukraine in order to combat gambling addiction (gambling addiction) and improve state regulation of activities related to the organization and conduct of gambling and lotteries,” signed by the President of Ukraine on January 3, 2025, prohibits advertising of gambling on television and radio from 6:00 to 23:00, but the onslaught of illegal lottery advertising on the Internet does not stop. Gray gambling operators continue to use aggressive marketing campaigns, filling the information space with their offers everywhere.

A common problem is that illegal lotteries do not obtain proper licenses and do not pay taxes. According to the Ministry of Economy, tax evasion by such operators causes significant damage to the state. According to experts, in 2024 alone, illegal lotteries could evade paying taxes in the amount of more than 3 billion hryvnia.

The head of the Ukrainian Gambling Council, Anton Kuchukhidze, believes that advertising of lotteries operating without official licenses creates significant obstacles to the development of legal gambling business and significantly harms the state budget. According to him, even the adoption of Law No. 9256-d is unlikely to have a significant impact on the situation in the near future.

The continuation of illegal lottery operations remains a serious problem. Lottery operators who ignore the need to obtain appropriate licenses are essentially imitating gambling without paying any taxes. In addition, advertisements for such services are actively spreading on the Internet, continuing to deceive players,” Kuchukhidze emphasized.

How does gray gambling advertising work?

Illegal advertising of lotteries in Ukraine is a complex and multi-level phenomenon that penetrates all possible information channels. Despite the ban on gambling advertising during certain hours on television and radio, gray operators are actively using the digital space. They use modern marketing tools, creating the impression of legality of their services and ensuring maximum audience reach.

One of the main methods is the mass introduction of contextual advertising. These ads usually do not contain overt signs of gambling, but their slogans such as “test your luck” or “get your winnings now” create the illusion of simplicity and accessibility. A key element of such campaigns is to conceal the real nature of the offer. For example, advertising can lead to sites that formally do not violate the law, but are conduits to illegal platforms.

In addition, lottery operators actively use retargeting technologies. After visiting the site, the user begins to receive personalized ads that constantly remind them of the opportunity to win. This creates psychological pressure and increases the likelihood that a person will place a bet.

Social networks are also an important tool in the hands of gray operators. Telegram channels, Instagram and Facebook pages are filled with advertisements promising “quick wins” or “win-win lotteries.” Often such channels are disguised as legal communities or information platforms, but their real goal is to attract new users to illegal services. In addition, many Telegram channels are anonymous, which makes them difficult to regulate and block.

Another powerful tool is sponsorship. Illegal operators make deals with organizers of sporting events, shows or even news sites. As a result, the names of the platforms appear in broadcasts or publications as “event partners.” This approach not only increases brand awareness, but creates the impression of their legitimacy. This is especially noticeable in the media space, where sponsorship sections are filled with “success stories” that highlight the possibility of winning, even if this is not true.

It is also important to note that gray gambling actively exploits gaps in legislation. For example, advertising lotteries does not technically violate the law, since they are not considered gambling. This situation allows gray operators to legally advertise their services, despite their illegal nature. Moreover, thanks to their high technology, such companies quickly adapt to changes in legislation, developing new ways to reach audiences.

Emotional content is another key element of advertising campaigns. Gray operators appeal to the desire for easy winnings by using images of happy winners and large sums of money. Such advertising creates the illusion that wealth is accessible, which especially affects people with financial difficulties. It also ignores warning requirements regarding the risks of gambling addiction, which are mandatory for legal operators.

Why the government fails to remove illegal lottery advertising

Despite numerous efforts, the state is currently unable to solve the problem of illegal lottery advertising. The main reason for this is weak control and insufficient effectiveness of measures aimed at combating illegal activities. The gambling market is still in a state of legal uncertainty, which allows unscrupulous operators to circumvent established regulations.

The lack of a clear system of penalties for breaking the law is a key factor contributing to the spread of illegal advertising. As market expert Evgeniy Zelenchuk noted, “the market is accustomed to permissiveness.” This is clear from the fact that, until recently, the Regulatory Commission of Gambling and Lotteries (CRAIL), which was abolished at the end of last year, had powers to impose fines, only used them a few times. And the amounts of those fines that were nevertheless imposed (including UAH 2 million) were insignificant for companies with large financial turnover. This created a situation where breaking the law became more profitable than complying with it.

Another problem is insufficient coordination between regulatory authorities. Participants in the illegal market skillfully exploit gaps in legislation to avoid liability. The lack of proper interaction between regulatory authorities (the same CRAIL), the National Police and other authorities allowed illegal operators to continue advertising their activities.

In addition, the current legislation has a number of shortcomings. For example, lottery advertising does not formally fall within the definition of gambling advertising. This allows operators to exploit loopholes to continue advertising their services without fear of fines. At the same time, legal restrictions, such as the ban on advertising on television and radio from 6:00 to 23:00, are often ignored. For example, bookmakers and online casinos find ways to circumvent these prohibitions by posing as program partners or publishing hidden advertising materials.

Another aspect is the low efficiency of control over digital platforms, in particular Telegram channels. The anonymity of these channels makes monitoring and sanctions much more difficult. Despite the fact that the advertising law also applies to them, the application of the rules to anonymous resources remains problematic. This allows unscrupulous operators to actively use such platforms to promote their services.

Solving the problem requires radical change. It is necessary to introduce effective monitoring mechanisms and strengthen sanctions, making them not just a formality, but a real instrument of influence. Only then can we expect that the government will be able to significantly limit the spread of illegal lottery advertising.