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Estonia’s Ministry of Finance is contemplating a gambling advertising ban, despite its fellow Baltic nations of Lithuania and Latvia outlining the difficulties they are experiencing enforcing similar restrictions.
Henrik Mägi, a lawyer at Estonia’s Ministry of Finance tax department, which oversees the gambling industry, said there are no changes yet “but there are plans for some” during a panel at the Mare Balticum Gaming and Tech Summit in Latvia on March 16.
The news of likely changes follows the establishment of a new coalition Estonian government in April 2023, which included in its formation an agreement to look into banning gambling ads.
“We will start to look into this matter in detail and won’t decide anything until we have done consultations, etc. We have not prepared any legislation on this from a ministry level yet, but the political will is there for it. Consultations will probably be launched this autumn. It is likely there will be changes, which could be either a new law or guidance,” Mägi said.
Estonia’s Ministry of Finance has already submitted a draft law that would increase online gambling, table game and lottery tax rates, as part of wider tax hikes across the economy.
It proposes that the rate for online gambling will increase to 6 percent in 2024 and then again to 7 percent in 2026.
Fellow Baltic countries Lithuania and Latvia may be able to provide insight into the impacts of an advertising ban in jurisdictions in the region.
Lithuania has heavily restricted gambling adverts, which has deterred some new market entrants.
Lolita Sumskaite, head of unit at the Ministry of Finance Lithuania, which oversees gambling policy, explained that since July 1, 2022 it has been possible for operators to receive an online licence without having a land-based establishment.
“Still, as far as I know, there are no newcomers that have received this licence yet,” Sumskaite said.
The licence fee is €500,000 for just online gambling and the tax rate has also recently changed to 20 percent of gross gaming revenues (GGR) for machines, table games, bingo and online gambling.
Kaido Ulejev of Betsson Group said despite these latest changes being “very positive”, the fact that there have been no new market entrants is likely down to the risks.
“It seems high-risk to enter with a new brand from scratch. Baltics are small markets and likely already established brands and so it's very expensive to enter and get market share. Lithuania’s regulatory changes I can't see impacting that due to taxation level and ad restrictions,” Ulejev said.
Ulejev warned the Estonian representative to really consider the impacts of any advertising restrictions before making any changes.
Perhaps the most ominous warning about advertising restrictions came from Signe Birne, director of Latvia’s Lotteries and Gambling Supervisory Inspection.
Birne reiterated that it is “practically not possible” to completely ban gambling adverts and said the country is starting to look into ways of easing current restrictions.
Jānis Ungurs, the Lotteries and Gambling Supervisory Inspectorate's legal department director, recently told VIXIO GamblingCompliance that “there are no data-based facts about the impact of advertising on players and society in Latvia yet (due to the fact that advertising has been banned)”.
Ulejev agreed with the Latvian regulator, adding that “the everyday reality we see is different to the law. The grey market share has been declining, but it is still the biggest in the Baltics. If you want to minimise this we need to make changes to the regulation. There should be some reasonable level of advertising allowed. This has been on the table for too long already.”
The Latvian regulator has launched a study on how the public and vulnerable people will be affected by the lifting of the advertising ban. However, Ungurs warned that this process may be slow.
