Gambling and Betting in Armenia From a Legal Perspective

In recent years, Armenia has witnessed a substantial rise in gaming activities. Statistical data reveals that profits from betting amounted to 2 trillion drams in both 2020 and 2021, escalating to 3.9 trillion drams in 2022. Notably, in 2015, the profits reached 5.8 trillion drams.

As both local and international investors continue choosing Armenia to register their companies, it is imperative to consider the legislative nuances and legal stipulations governing gambling and betting in Armenia.

Legal Definitions of Gaming Activities

The legislative framework governing gambling in Armenia is primarily bifurcated into two domains: “winning games” and “lotteries.” The pertinent statutes in force include the Republic of Armenia’s laws “On Winning Games, Online Winning Games, and Casinos” and “On Lotteries.” Under these laws, the following definitions apply:

  • Gambling: Any mechanized or live game that offers an opportunity to win or participate with potential winnings, either directly in a gaming room and/or via the Internet or similar global systems and any coordinated network channels (e.g., poker).
  • Lottery: A public event wherein the organizer conducts a draw from a lottery fund among participants. The winnings are determined solely by chance and do not depend on the participant’s actions or will.
  • Sweepstake: A game wherein a participant predicts a potential outcome of a gaming, sports, or socially significant event. The winning is determined by the partial or complete accuracy of the prediction.

Based on the aforementioned legislative framework, three critical elements of gambling participation can be distinguished under the laws of the Republic of Armenia:

  1. Consent: The voluntary agreement or permission given by an individual to participate in the game.
  2. Randomness: The element of chance by which the outcome of the game is determined.
  3. Winning: The receipt of a prize or monetary gain, which constitutes the primary objective of both gambling and lotteries.

Remote Gambling and Winnings

First and foremost, it should be noted that internet-based gambling is deemed to provide players with the opportunity to participate in games with potential winnings, either independently or contractually, within the territory of the Republic of Armenia.

Internet-based gambling is considered to be organized within the territory of the Republic of Armenia if the servers of the gambling organizer are located within Armenia, possess an Armenian IP address (Internet Protocol address), and the relevant informational resources are situated within the “.AM” domain.

Age Restrictions

Only individuals who have reached the age of 18 are eligible to participate in lotteries, with the exception of sweepstakes, for which eligibility is restricted to individuals who have reached the age of 21.

Sanctions for Illegal Organization of Games

The organization of gambling activities without state registration as a legal entity or without obtaining the requisite license is classified as engaging in illegal business activities. The legislation of the Republic of Armenia prescribes both administrative and criminal liability for such offenses.

Specifically, according to the RA Code of Administrative Offenses, engaging in illegal entrepreneurial activity—defined as conducting business without state registration or requisite notification for activities requiring a license, or without possessing the appropriate license—results in the imposition of fines ranging from 15,000 to 30,000 drams.

The RA Criminal Code stipulates penalties for engaging in illegal business activities, including fines ranging from 10,000 to 30,000 drams, community service for a duration of one hundred to two hundred hours, restriction of liberty for up to three years, short-term imprisonment for up to two months, or imprisonment for a period not exceeding three years.

In addition to the aforementioned sanctions, the laws of the Republic of Armenia regarding “games with winnings, internet-based games with winnings, and casinos,” as well as “On Lotteries,” delineate penalties for contravening their provisions, including:

  1. Issuance of a warning and recommendation to rectify violations, accompanied by a fine
  2. Suspension of the license
  3. Revocation of the license

Regulatory Authorities in Gambling and Betting in Armenia

The RA State Revenue Committee is responsible for overseeing the operations of lotteries, gambling, online gambling, and casinos. Regarding the licensing procedure within this domain, the Ministry of Finance of the Republic of Armenia serves as the authorized body.

Tax Obligations for Entities Involved in Gambling and Betting

As per the RA law “On State Duty,” the annual state fee for organizing games with winnings varies based on the location:

  • In Tsakhkadzor city, the fee is 180,000,000 AMD.
  • In Sevan city, the fee is 150,000,000 AMD.
  • In Jermuk city, the fee is 100,000,000 AMD.
  • In Meghri city, the fee is 35,000,000 AMD.
  • In other locations, the fee is 5,500,000,000 AMD.

Given the substantial annual state duty amounts, individuals or entities organizing gambling activities enjoy exemptions from nearly all taxes. The sole tax obligation under the legislation of the Republic of Armenia is the income tax, assessed at a rate of 18% on the tax base.

Advertising of Gambling and Betting in Armenia

Under the Law of the Republic of Armenia “On Advertising,” organizers of lotteries, games with winnings, internet-based games with winnings, or casinos lacking the requisite license are prohibited from advertising their activities within the Republic of Armenia.

Specifically, it is forbidden to advertise any game with winnings, online games with winnings, casinos, gaming halls, or their lottery organizers, except for advertising on their official websites or within the premises of casinos, gaming halls, or sweepstakes venues (such as gaming halls or bookmaker’s offices). Additionally, advertising is permitted at border entry points of the Republic of Armenia and in hotels that meet the qualification standards of at least four stars.

Important to Consider

When advertising gambling, online gambling, or casinos, it is mandatory to display “21+”. Conversely, when advertising lotteries, non-lottery games, or combined lotteries, the “18+” mark must be prominently visible.

However, the advertising of lotteries, gambling, online gambling, or casinos is strictly prohibited if it involves any of the following:

  • Depicting cash or underage individuals,
  • Directly targeting minors in any manner,
  • Conveying the notion that participation in the game guarantees regular income or serves as an alternative to employment,
  • Creating the impression of guaranteed income or profits,
  • Suggesting that the game can lead to social, professional, or sporting success.

This advertisement must include warning information regarding the prohibition of playing while under the influence of alcohol or in a state of psychosis.

Legislative Changes in Gambling and Betting in Armenia

In early 2024, the Armenian government enacted new regulations concerning gambling, encompassing the following provisions:

  1. Individuals under the age of 21, citizens utilizing any state-funded subsidy program or co-financed programs, and beneficiaries of family insecurity-based initiatives are prohibited from participating in games with winnings.
  2. Implementation of an electronic management system involving the interconnection of information systems, software, and databases of game organizers with the monitoring center of the electronic game management system. Furthermore, all gaming products and online platforms must obtain certification from reputable international laboratories, with verification conducted by a government-selected operator through a competitive process.
  3. Prohibition on participating in games with winnings organized in foreign countries on Armenian territory.
  4. Requirement for identification of the player’s bank card and game balance. Additionally, game organizers have the authority to verify the player’s bank account by submitting a request to the respective bank.

The new changes regarding gaming and betting in Armenian products and activities are expected to enhance personal data protection by ensuring the full verifiability of gaming products and the probability of winning. This will also enable the verification and control of companies’ turnovers and the volume of bets placed, thereby impacting tax revenues positively.

These changes are slated to come into effect on July 1, 2024, although there is a possibility that they may be deferred to January 1, 2025, to allow for the resolution of all organizational matters.

For comprehensive guidance on your gambling rights in Armenia or assistance in obtaining a gambling license, our legal team stands ready to address any issues pertaining to this domain.

Contact our team to get custom-tailored and professional advice on your case!

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