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27 February 2024
north macedonia serbia

Controversial amendments to the Macedonian gambling regulation

North Macedonia is currently in the process of amending the Games of Chance and Entertainment Games Act (the "Gambling Act"). Earlier in February, the Macedonian Parliament adopted the amendments to the Gambling Act, but President Stevo Pendarovski declined to sign the Decree for entry of the amendments into force, consequently returning them for further redrafting.

As the authoritative body overseeing the Gambling Act, the Ministry of Finance (the "Ministry") previously proposed and prepared the amendments with the aim of protecting the public, in particular young people, from potentially dangerous habits such as gambling. The key proposed amendments included:

  • Location change, i.e. the requirement that venues that host games of chance, such as betting shops and slot machine clubs, indoor raffles and electronic games of chance, now must be located at a distance of at least 500 metres from primary and secondary schools.
  • A substantial increase in licence fees for operators. For instance, the fee for organising games of chance in betting shops was increased from EUR 105,000 to EUR 200,000 with the additional caveat that one licence is limited to opening no more than 25 payment places. For every subsequent opening of a payment place, the organiser of games of chance in betting shops must pay a fee of EUR 10,000 per payment place.
  • Under the current legislation, organisers of special games of chance such as casinos, betting shops and slot machine clubs, pay a special fee of 20 % calculated from the difference between the monthly paid-in amount and paid-out amount. If there were a loss in the given month, the organiser would not have to pay this special fee. The Ministry argued that because they suspect certain organisers of special games of chance are masking the financial data of their operation, the proposed amendments envisage additional, alternative payment grounds based on payment per machine.
  • Organisers of online games of chance are also subject to a fee increase. It is proposed that they pay a special fee of 6 % calculated from the amount of the total pay-ins made from online lottery games of chance and 20% from the amount of the total pay-ins made from online special games of chance. Additionally, it is proposed that they pay a monthly special fee of 3 % for the administration of the information system connected to the Public Revenue Office. Moreover, the regulation of the internet hosting of games of chance is strengthened by the prescribed implementation of the principles for protecting consumers and online players, as well as the principles of prohibiting and preventing minors from gambling online.
  • Finally, the proposed amendments also affect operators of electronic games of chance and organisers of online games of chance by imposing the obligation to institute a "Supervisory Information System" to be connected to the information system of the Public Revenue Office as the overseeing body.

The proposed amendments did not escape heavy criticism. For example, the Association of Betting Shops in North Macedonia, as well as other adjacent organisations in the gambling industry, are direct and unapologetic in their claims that the proposed amendments may be detrimental for the gambling industry. As the biggest current private employer and the second-largest employer in North Macedonia overall after the Public Administration, their concerns have not gone unheard.

Besides the ambiguous political implications in the public discourse on the proposed amendments, there are also legal hindrances, particularly the legislative procedure. The attempt by the Macedonian Parliament to swiftly enact these proposed amendments by using the shortened lawmaking "EU Flag" process, where Macedonian domestic law is harmonised with EU law without public debate, was heavily criticised by many opponents of the amendments. Even the EU has submitted a written notice to President Pendarovski and the Macedonian government and parliament, clarifying that the EU Flag process was manipulated in this case and should not be liberally applied to justify quick lawmaking.

Overall, the outcome of the current turbulent process remains uncertain.

authors: Filip Srbinoski, Andrea Lazarevska