Armenian gambling stakeholders have warned of dire consequences should the National Assembly approve Finance Minister Armen Hayrapetyan’s amendments to the federal Advertising Law – imposing a near blackout on gambling advertising.
Concerns have heightened as last week 56 MPs voted in favour of Hayrapetyan’s amendments to the Advertising Law (versus 8-against), that will see gambling adverts restricted to ‘the premises of four-star and above hotels, border checkpoints and ‘in the front of buildings carrying out the similar business activities’.
Leading Armenia’s Ministry of Finance, Hayrapetyan has urged the Assembly to back his bill to “unify policies for the gambling sector and imposing equal competitive terms and requirements on businesses”.
Speaking to CIS gambling news source SBCCIS.com, Tereza Tokmajyan Chief Marketing Officer (CMO) of Armenian licensed bookmaker Toto Gaming challenged Hayrapetyan’s decree.
As Armenia’s Finance Minister aims to replicate the advertising restrictions imposed by Latvia, Estonia and the Czech Republic, Tokmajyan underscored that Armenia maintains amongst the most stringent advertising codes for licensed operators.
“The current Law in Armenia has very strict limitations to advertising online games and lotteries. Operators have to comply with the legal restrictions,” Tokmajyan noted.
“Current regulations allow advertising of online gambling and lotteries on TV from 22:00 to 7:00, on radio from 08:00 to 20:00, also the total length of the advertising should be maximum of 3 minutes and it can be aired only two times per hour. At the same time, the total advertising airing time of gambling during an hour can not be more than 60 seconds.”
As a result, Armenia’s licensed incumbents have complied with several advertising restrictions imposed well before other European counterparts. Case in point, Armenia restricts online gambling advertising from being displayed on news and entertainment websites from a 10pm to 7am timeframe.
Tokmajyan stated that the demand for further restrictions would result in a “de-facto prohibition of the advertising and leave no room for effective marketing communication.”
“Imposing regulations are prohibiting advertising over the internet. This however seems to be a hassle and we suspect that the governmental bodies will have trouble controlling the mentioned regulations.”
Toto Gaming’s marketing officer acknowledged public anxieties related to operators increased gambling coverage, but stated that concerns should highlight “during the pandemic many other industries significantly reduced their marketing budgets, thus this background makes it seem that gambling ads are more than other adverts being displayed”.
Tokmajyan urged ministers to recognise media owners’ concerns relayed to the Standing Committee of Economic Affairs, which cited that between 60-70% of income was generated by online gambling and lottery businesses.
“Of course, this will affect hundreds of employees, who will lose their jobs because of lack of financing in the media industry,” Tokmajyan reflected. “Many radio companies will face the reality that they will probably have to shut the operations, as the big portion of their income is generated from the gambling industry.”
Meanwhile, regulatory conflicts were detailed by Digitain Legal Counsel Vaagn Tangamyan, who cited that Advertising changes would simply risk Armenia becoming a new playground for black market actors.
“In terms of new regulations in the first place we see the risk of foreign operators becoming more active in targeting the Armenian population,” Tangamyan explained.
Licensed incumbents have relayed technical concerns to the government, should restrictions proceed – “In the past, it was less lucrative for them because we had all the rights for advertising and could reach audiences much cheaper. In a new reality we lose the competitive advantage and at the same time think that the government won’t be able to execute the regulation of banning the gambling ads over the internet.”
Tangamyan concluded that Hayrapetyan’s amendments represented a clear and present threat to the status of Armenian gambling a sector that has provided the nation’s emerging economy with a transparent tech sector contributing to well-paid jobs and taxes.
“The provisions of the government stated that the changes wouldn’t affect the budget and the economy of the country, but we suspect that the changes will affect the economy as firstly gambling industry is one of the biggest advertising buyers and of course pays the taxes when purchasing marketing services and secondly, our financing allows sports media and ads markets to grow.
“The result of the changes would also mean the 0 chance of having new operators enter our market, as no reasonable company would start operations where it can’t have any marketing activities.”