Version: 01012005
Editor: Franka Pals
Publisher: Novamedia
Disclaimer: Novamedia disclaims all liability for information provided within the ”Novamedia European Gaming and Lottery Files”.The information is supplied by independent journalistic sources. No parts of these files may be reproduced in any form by print, photo print, microfilm or otherwise, or re-distributed electronically in any form without written permission from the publisher.
Once called the "Breadbasket of Soviet Union," Ukraine is rich in natural resources. This includes excellent agricultural land and a substantial industrial base consisting of coal and mineral resources, aerospace and chemical industries.
Despite this wealth of resources, the Ukrainian economy has suffered badly since the nation's independence in 1991. Although independence was achieved with the dissolution of the USSR, true freedom remains elusive, as many of the former Soviet elite remains entrenched, stalling efforts at economic reform, privatization, and civil liberties.
This reflects on all sectors of industry that have experienced major production declines.
Kiev the capital of Ukraine, has a population of nearly 3 million inhabitants and is by far the largest city and serves as a major industrial center mainly because of its advantageous location along the Dnipro River, which links Kiev to the Black Sea.
Ukraine is governed under the constitution of 1996. The head of state is a popularly elected president who serves a five-year term. Ukraine has a 450-seat parliament whose members serve four-year terms. In April 2000, referendum voters approved reducing the number of seats in parliament to 300 and splitting the unicameral body into two chambers, one elected and the other appointed by the president.
Near the Belarus border in the abandoned town of Pripyat, is the Chernobyl nuclear power station, site of the worst nuclear reactor disaster in history. On Apr. 25, 1986, during an unauthorized test of one of the plant's four reactors, engineers initiated an uncontrolled chain reaction in the core of the reactor after disabling emergency backup systems. On Apr. 26, an explosion ripped the top off the containment building, expelling radioactive material into the atmosphere; more was released in the subsequent fire. Only after Swedish instruments detected fallout from the explosion did Soviet authorities admit that an accident had occurred. The reactor core was sealed off by airdropping a cement mixture, but not before eight tons of radioactive material had escaped. Thus releasing vast quantities of radiation into the atmosphere.
Many good things have come from the Ukraiane as well. Many famous persons originated from the Ukraine. Among them are Igor Sigorsky (inventor of the helicopter), Oleg Antanov, Sigmund Freud, famous ice hockey player Wayne gretzky and recent pop celebrity Andy Warhol.
Commonwealth of Independent States (CIS)
The commonwealth of Independent States (CIS) consists of 12 of the 15 states of the former Soviet Union, excluded are the 3 Baltic States whom along with Georgia (it did later join in 1993) refused to join. They proclaimed to be wrongfully and illegally incorporated into the Soviet Union.
During the collapse of the Soviet Union in the fall of 1991 leaders of Belarus, Ukraine and Russia signed an agreement establishing the CIS.
On December 21, 1991, all the 11 leaders of the 15 Soviet Republics met in Alma-Ata, Kazakhstan to sign the charter.
It stated that all members were sovereign equal and thereby effectively abolishes the USSR with effect from December 31, 1991.
The headquarters of the CIS are in Minsk, Belarus. At present the CIS unites: Azerbaijan, Armenia, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan and Ukraine.
Although the CIS has few supranational powers, it is more than a purely symbolic organization and possesses coordinating powers in the realm of trade, finance, lawmaking and security.
In September 1993 the Heads of the CIS States signed an Agreement on the creation of Economic Union to form common economic space grounded on free movement of goods, services, labor force, capital; to elaborate coordinated monetary, tax, price, customs, external economic policy; to bring together methods of regulating economic activity and create favorable conditions for the development of direct production relations.
The most significant issue for the CIS is the establishment of a free trade zone, economic union between the member states, planned to become a reality in 2005. It has also promoted cooperation on democratization and cross-border crime.
| Population: | 47,732,079 (July 2004 est.) |
|---|---|
| Age Structure | 0-14 years: 15.9% (male 3,883,485; female 3,715,668) |
| Currency: | hryvnia (UAH) |
| GPD | purchasing power parity - $260.4 billion (2004 est.) Per capita: purchasing power parity - $5,400 (2004 est.) Real growth rate - 9.4% (2004 est.) |
| Internet: | Internet use in Ukraine has increased fivefold since 1999. From 2000 to 2001, it jumped by 30 to 40 percent. In 2002 there were 900.000 internet users in Ukraine. Due to increased competition among Ukraine's 260 Internet service providers the cost of Internet connection has dropped dramatically. In 2004 there were 94.345 internet hosts. |
| Telecom | At independence in December 1991, Ukraine inherited a telephone system that was antiquated, inefficient, and in disrepair. More than 3.5 million applications for telephones could not be satisfied. Telephone density is now rising slowly and the domestic trunk system is being improved; the mobile cellular telephone system is expanding at a high rate. There were more then 6.8 million mobile phone users in 2004. There are currently 5 operators offering mobile services; UMC, Kyivstar GSM, Golden Telecom GSM, DCC, and Wellcom. Close to 11 million main phone lines where in use as of 2002 which means a little over 21 main telephone lines per 100 inhabitants. |
| Television | in 1997 there were at least 33 stations (plus 21 repeaters that relay broadcasts from Russia |
Website: http://gska2.rada.gov.ua/ control/en/index.html
State regulation in the field of gambling business is performed by the Verkhovna Rada of Ukraine. This is the parliament and sole body of legislative power. Also involved are the Cabinet of Ministers of Ukraine, the Ministry of Finance of Ukraine and the State Tax Administration of Ukraine.
It is prohibited to play or advertise in any way on Ukrainian territory gambling games organized abroad.
Draft law N 4204
In 2003 the government suggested to determine legal grounds for organization and performance of gambling games. On September 30, 2003, People's Deputies V.Sivkovych, H.Samofalov introduced into the Verkhovna Rada of Ukraine draft law N 4204 "On Gambling Games in Ukraine".
According to the draft, a gambling game is any game based on chance with the purpose of gaining the prize (winnings), an obligatory condition for participation being stakes placed by gamblers.
It is permitted to organize and perform the following types of gambling games on Ukraine's territory:
State monopoly for drawing lotteries is to be introduced in Ukraine. The draft law envisages this introduction. Distribution of state lotteries is to be performed by legal entities and natural persons on the basis of agreements with a Unified Operator of State lotteries. The Unified Operator of State Lotteries is to be determined through a tender by tender commission, the composition of which should be approved by the Cabinet of Ministers of Ukraine. The Unified Operator of State Lotteries should be a joint stock company, where at least 25% of shares belong to the state.
Foreign natural persons and legal entities shall not have the right to own directly or indirectly more than 35% of shares in the Unified Operator. Non-residents shall purchase shares of the operator upon a permit from the Council on Lottery Activity.
Draft law N 4204-1
On October 24, 2003, the Cabinet of Ministers of Ukraine introduced into the Parliament draft law N 4204-1 "On Lotteries and Other Gambling Games in Ukraine".
The draft is an alternative to draft law N 4204 introduced by People's Deputies V.Sivkovych and H.Samofalov discussed before.
According to the draft, a gambling game is any chance game aimed at gaining the prize (winnings), provided the player has put in a stake for participation therein.
According to the draft, license is to be issued for the following types of activity:
Lottery is a mass gambling game regardless of the name, conditions of which include drawing of prize fund between the players and winning is of a chance nature. The territory for drawing lotteries is not to be limited to one building, except for slot machines united into a network, as well as totalizator units united into a network.
Financial transactions related to payment of prizes (winnings) are subject to obligatory internal financial monitoring.
As stated in the 'law on income tax', adopted July 5, 1991, certain incomes, about 25 categories, are exempt from taxation. They range from social welfare payments to inheritance and lottery winnings. (Art. 3 and 9). Other listed incomes are taxed at a reduced rate. (Art. 10).
The law "On Licensing of Certain Types of Economic Activity" (date of entry into Force: October 21, 2000) defines the types of economic activity (including organization and maintenance of totalizators, gambling facilities, release and raffle of lotteries) which are subject to licensing; sets forth licensing procedures; establishes state control in the field of licensing; determines responsibilities of economic entities and licensing bodies for violation of licensing legislation.
The law establishes the uniform procedure for issuance of licenses. For the purposes of obtaining a license it is necessary to submit a standard application and other necessary documents to a relevant licensing body, which within 10 days (unless specific laws governing relations in some fields of economic activity provide for other deadlines) makes a decision on whether to issue the license. The application should also be accompanied by a copy of certificate for state registration of subject of entrepreneurial activity. For some types of economic activity - subject to licensing - the application for obtaining license shall enclose documents, the full list of which is to be determined by the Cabinet of Ministers of Ukraine.
Article 13 stipulates that licensing bodies use license forms of unique sample within the territory of Ukraine. A license form of unique sample is approved by the Cabinet of Ministers of Ukraine. This article also specifies license properties.
On the basis of a license, issued by a licensing body, which is the central body of executive power, economic activity can be performed within the entire territory of Ukraine.
A duty can be paid for issuance of the license. The rate of duty and the procedure for remitting it to the State Budget of Ukraine are determined by the Cabinet of Ministers of Ukraine.
The Law also sets forth the procedure for reregistering licenses, issuing copies and canceling licenses. The Law envisages introduction of a unified register for all issued licenses.
The Law also determines norms related to responsibility for violation of provisions of this Law (Article 22 of this Law) and compensation of damages due to violation of the legislation in the field of licensing (Article 23 of this Law).
Website: www.lottery.com.ua/eng/
The Ukrainian National Lottery (UNL) enterprise conducts state lottery and was launched in December 1997. Proceeds from the lottery are allocated to Ukraine's pension fund and priority civic and community projects. In 2000 sales were 50 million Hrn. More than 3,000,000 people play UNL lotteries each month.
UNL offers 3 games: SuperLoto (a jackpot-lottery), Keno and Pick3. Prizes are reaching from 5 hrn to several millions.
In November 2002, another game was launched and Ukrainian players where introduced to a "bingo style" game. The Ukrainian bingo was called Bingo BOOM lotto. After 56 draws however, in December 2003, this lottery game ceased to exist as it proved to be an unsuccessful formula for UNL.
At the moment UNL is the only company in the territory of CIS (Commonwealth of Independent States), that gives opportunity to play lottery games "on-line". The "on-line" system allows for fast and precise bet placement and is also capable of validating a winning ticket on the day following the drawing. There are currently more than 2,400 lottery terminals around Ukraine.
In the majority of large cities of Ukraine more than 2400 terminals are set.
The numbers chosen by the player are sent by phone and radio to the central computer where they are encoded and safely stored. The terminal itself is not storing any information and requests all the information from a central server. Due to the presence of complicated and reliable telecommunication and radio nets, tickets are printed at the moment of purchase.
This makes entering these lotteries a very simple matter. Through these measures, unique in the Ukraine, the UNL grew out to be one of the biggest players on the Ukrainian market.
It was with the UNL company that the biggest Jackpot in the history of all Ukrainian lotteries was won; 3 800 000 Hrn. (550.000 Euro)
In Oktober 2004 the Ukrainian National Lottery made an agreement with with Cilat Satellite Networks Ltd. The latter will supply UNL with a satellite-based VSAT network. The network will serve lottery kiosks a cross the country.
Website: www.msl.com.ua/