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Legal basis for organisation, operation and government regulation of lotteries in the Russian Federation

The major law that establishes the legal basis for organisation, operation and government regulation of lotteries in the Russian Federation is “Law on Lotteries” (138-FZ, dated November 17 2003).

Law defines the types and purposes of lotteries, procedures for controlling the organisation and operation of lotteries and liabilities of persons as well as organisers for running and operating of lotteries.

As for now according to the recent amendments only bodies duly authorised by the Russian Government can organise lottery tenders, sign lottery contracts with lottery operators and approve lottery rules may act as lottery organisers.

Lottery operators are legal entities registered under the Russian legislation that have concluded lottery operation contracts with lottery organisers. The Law sets out the tender rules for awarding lottery operation contracts, requirements on bidders, tender admission terms, etc.

There only 2 types of lotteries can be allowed in Russia under lottery law which are all-Russian state lottery and international lotteries (i.e. lotteries conducted under an international treaty on the territories of two or more states including the Russian Federation).

Lottery will be conducted on a competitive basis, at this competition will be carried out only by two agencies - Ministry of Finance and Ministry of Sports.

Internet lotteries (other than international and all-Russia state ones) are now prohibited, as is gambling in the guise of lotteries or lotteries using gaming equipment, including game machines.

As of now the technical regulations for lottery equipment have been amended. As a result, the equipment (lottery terminals) has to be registered in unified register of lottery terminals which is regulated by government executive body.

There are certain rules in this Law as well on prize fund allocation matter.    The prize fund of the lottery is not part of the property of the founder or lottery operator and cannot be used for any other purposes than pay-off of the prizes to the winners of the lottery. Proceeds from lottery sales should be split and with not less than 50% and not more then 80% of them going to the prize fund.

All lotteries that sell on the territory of the Russian Federation, no matter what type, size or regional status, should all be registered. 

The Law lists the specific mandatory details for lottery and, now also, electronic lottery tickets, as well as the information that must be published on the Internet by operators conducting lotteries using electronic lottery tickets.

The Law imposes a new obligation on lottery operators, i.e., to provide an irrevocable bank guarantee securing their obligations to make purpose payments. The bank guarantee must be valid for at least five years and must be issued by any of the banks included on the list of complying banks whose guarantees may be accepted for taxation purposes (article 74.1 of the Tax Code of the Russian Federation).

Sale of lottery tickets and electronic lottery tickets and installation of lottery terminals in buildings accommodating children's, educational, religious and certain other organisations are not allowed. 

Electronic tickets. Electronic tickets system for participation in lotteries is not much developed in Russia. Only in May 2010 first Russian company Orgloto (operator of lottery Gosloto) started to sell electronic lottery tickets in Russia. After drawing if the ticket wins the owner will automatically get SMS with special code. Now the winner can get his money in the office of Gosloto and by QIWI, Novoplat and Lotter payment systems (terminals).

Updated July 3, 2016

 

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