The Lithuanian gambling sector is poised for some significant changes following a recent plan to re-evaluate the existing regulatory framework. These changes are to be executed by the Finance Ministry, which has drafted a list of amendments aimed at improving the local gambling scene.

Some of the most notable regulatory changes under consideration include engaging betting operators in the control and monitoring of at-risk players, i.e., those with a gambling addiction or who often lose large sums of money.

The proposal to introduce these tight measures was made after a recent scandal involving Šarūnas Stepukonas, a former partner at the BaltCap Infrastructure Fund. According to a report released after investigations, Stepukonas embezzled over €30 million from the firm’s companies and gambled it away at casinos.

Current Political Will Adamant on Amending Regulations

While most gambling restrictions are usually advocated for by individuals or groups in the affected communities, the landscape in Lithuania is slightly different. The move to have stricter regulations for this market mainly comes from the country’s leaders, who have taken a particular interest in ensuring consumer safety is prioritized.

Several proposals to amend the Lithuanian Gambling Act have been tabled by MPs, most of whom are members of the ruling Homeland Union party. One such amendment signed by the MPs and set to take effect in 2025 is the ban on gambling sponsorships in sports and other public events.

This means it would be illegal for any logos or names of gambling brands to appear on athletic kits or at sports venues. Operators may only display their signage at their head offices, company websites, and gambling premises, but not in the stipulated venues or settings. These include news blogs, TV, newspapers, magazines, and billboards. 

Striking a Balance between Public Welfare and Gaming Revenue

In recent years, the gambling industry has become a focal point for several jurisdictions, bringing in substantive income and changing the overall financial ecosystem. Seeing as the main focus has been on improving the revenue stream, it is pretty easy to get carried away and forget some of the most critical aspects of the market: consumer protection.

A look at the Lithuanian gambling sector, as reported by Mindaugas Lingė, the MP who proposed the amendments, revealed that the gross gaming revenue greatly improved in 2023. The industry reported a GGR of €222.2m, more than double that reported in 2020 (€103m). The amount spent on advertising also doubled from €6.36m in 2020 to €12.73m in 2023. This resulted in operator profits rising from €20m to over €53m.

The draft amendments are set to be sent to the gambling authorities in the coming weeks for approval. From there, the amendments will then be tabled to parliament during the spring session. Vilija Petronienė Petronienė, a senior advisor at the Financial Markets Policy Department of the Finance Ministry, revealed:

In the near future, this week or next week, we will table [the amendments to the Gaming Law] to the authorities for approval.

A number of gambling safety advocates have lauded the proposed amendments, pointing out that they would be beneficial for promoting public health and preventing gambling harm. The ban on gambling ads in specific areas has also been praised, with advocacy groups noting that this would most likely discourage the normalization of gambling as a pastime and consequently lead to less risky behavior for at-risk players.

On the flipside, gambling operators have come out to protest the changes, arguing that they are likely to hinder the industry’s growth. The operators reported that gambling ads were vital in creating visibility for their businesses and, in turn, driving revenues, a lack of which would have the opposite effect.

Reporting to the parliamentary Anti-Corruption Commission, Petronienė reiterated the stipulations in the amendments to have operators apply responsible gambling measures to protect vulnerable individuals. Gambling restrictions are already being implemented on gambling ads and safer gambling measures at casinos, with fines and penalties being imposed on all those found in violation of the new rules. For example, an inquiry has been launched into Olympic Casino Group Baltija, where Stepukonis is suspected to have gambled a substantive amount.

The Lithuania Gaming Control Authority stated that the casino should have stopped Stepukonis when it was apparent that he was losing large amounts. He also noted that the gambling guidelines on problem gambling measures (for 2021 to 2023) had not been specified as mandatory and were only presented as recommendations, creating a loophole for operators to deny liability when such instances occur.

Other operators found culpable of gambling violations related to online gambling, payments, and underage betting have been hit with huge fines by the regulator. Operators who have since been hit include Baltic Bet, fined €16,705 for non-compliance, and Top Sport, slapped with three penalties in a week. Kęstutis Daukšys, a prominent politician and economist, observed:

Unfortunately, they are only recommendations. They define a lot of mechanisms on what a gambling operator should do. If he gambled on such huge amounts, they should have come into contact with the gambler and prevent the gambling. Olympic’s CEO has said that they followed all the rules, so we will look into that too.

Way Forward for Proposed Amendments

The Lithuanian gambling industry has proved to be thriving, raking in enormous profits for operators and generating considerable tax revenue for the state. While it is essential to acknowledge the industry’s economic contributions, it is equally vital that public interests are prioritized.

This is the primary concern voiced by the government and is why ongoing discussions are centered on coming up with regulations that will boost the economy while upholding its commitment to protecting players. If implemented, the amendments will play a key role in mitigating any potential harm associated with non-restricted gambling, protecting the Lithuanian residents.