Montenegro pushes for gambling reform after two decades

Sudhanshu Ranjan November 22, 2024

SiGMA news

Montenegro pushes for gambling reform after two decades

Montenegro’s gambling industry is at a crossroads. With outdated regulations hindering growth and leaving gaps in player protection, the Ministry of Finance has taken the reins to propose a much-needed overhaul.

The current gambling laws, which have remained largely unchanged for two decades, no longer address the complexities of modern gaming. Operators face challenges such as weak enforcement of rules, unregulated platforms, and inconsistent tax policies. These limitations have paved the way for reform.

Objectives of new proposed legislation

The Ministry of Finance has outlined several goals for the updated law. One of the major goals is reducing risks associated with problem gambling and protecting vulnerable groups. Other goals include enhancing mechanisms to detect and deter illegal activities like money laundering and addressing the societal impact of gambling through robust safeguards. The draft law proposes significant limits on gambling advertisements, including prohibiting ads near schools and youth-centric areas and allowing promotions only in specific venues and websites.

Operators will be required to implement stringent identification measures for both in-person and online gambling. This includes verifying the age and identity of players to prevent underage participation. Betting shops must be located at a safe distance from schools and other youth-focused facilities.

Jovana Ni?avi?, State Secretary for Finance, stated, “Thus, after two decades, Montenegro will have a new legal solution in the field of games of chance, which will include the key pillars, namely the protection of minors and young people, through provisions concerning the limitation of advertising, the distance of betting facilities from schools, and the identification of players both at bookmakers and online betting.”

The consultation process began in October and was extended due to overwhelming interest. Contributions from stakeholders, including public authorities and local businesses, have shaped the draft law, ensuring it reflects diverse perspectives.

Controversial measures in draft law

A proposed 15 percent tax on winnings has raised eyebrows. Such a policy could deter players and reduce operator revenues, leading to a decline in government tax collections. Restricting advertisements might conflict with EU norms, potentially stifling market growth and limiting outreach. As an EU candidate country, Montenegro must ensure its reforms align with EU standards. The proposed restrictions must strike a balance between regulation and fostering a competitive market.

While the reforms aim to protect players, they also impose challenges on operators, such as adapting to new payment systems and advertising rules. Customers may face reduced access to convenient services, potentially driving them away from regulated platforms. Despite challenges, the new legal framework offers several advantages: minors and vulnerable groups will be better protected, a level playing field for operators will make competition fairer, and clearer rules will build trust in the market.

Implementing these reforms will require careful planning, robust enforcement, and collaboration between regulators and operators. If implemented successfully, the reforms could position Montenegro as a leader in regulated gambling, attracting investment and fostering sustainable growth.