Citing protests from the domestic gambling industry, the government moved on Wednesday to postpone by at least one year the impending entry into force of new significant restrictions on gambling in Armenia.
Prime Minister Tigran Sarkisian called for a corresponding amendment to a law that was enacted by his government in 2010 with the aim of moving casinos further away from Yerevan.
The law essentially bans casinos and other gambling sites from operating anywhere except Armenia’s three most popular resort towns starting from January 2013. Casino owners were supposed to be allowed to do business in Yerevan and other parts of the country only if they invest an equivalent of at least $100 million in a particular property.
The vast majority of Armenian casinos are small and medium-sized businesses located just outside Yerevan. A law that took effect in January 2003 banned gambling activity within the capital.
The government said in 2010 that by largely confining the gambling business to the towns of Jermuk, Tsaghkadzor and Sevan it would spur the development of Armenia’s main tourism destinations and at the same time lower the number of regular casino visitors.
Armenia - Casino owners at a meeting with Prime Minister Tigran Sarkisian, Yerevan, 26Sep2012.
Sarkisian said the law should go into force no sooner than in January 2014 as he met with a group of casino owners concerned about the measure. He instructed the Ministry of Finance to draft relevant amendments that will be submitted to the Armenian parliament soon.
A government statement cited the entrepreneurs as saying that the existing law, if implemented now, will leave the industry effectively monopolized by a single company. They referred to the ongoing construction of a large casino just north of Yerevan, which is expected to pass the legal investment threshold. They said they were hit hard by the 2009 recession and cannot afford similarly large-scale investments.
Sarkisian agreed with their concerns, saying that he is against any economic monopoly. “I don’t consider myself a supporter of those who use your sector’s services because I believe that gambling does not befit Armenians,” he was reported to say. “But I accept your arguments. We must form a regulatory environment that will take into account the interests of small and medium-sized business and introduce strict regulations for gambling activities so that we can spare our society additional risks.”
Sarkisian’s cabinet faced opposition criticism when it pushed the existing law through the parliament in February 2010. Opposition lawmakers claimed, among other things, that it is designed to benefit wealthy businesspeople close to the government.