Zelensky Signs Off on Parimatch's Suspension in Ukraine

President Volodymyr Zelensky's most recent statement has come as a shock to many in the igaming community as it announced the sanctioning of many online gambling companies operating in Ukraine which are associated with Russia.

This included Parimatch Ukraine.

On the 10th of March 2023, Zelensky's public address summarized the government's decision to take action against any company that is known to maintain ties with Russia following the invasion of Ukraine.

This will be as per the new Presidential Decree no.145/2023 lasting 50 years.

The Decree was announced along with the news that Parimatch Ukraine would be one of the first in a group of online gambling platforms whose activities in Ukraine are to be ceased effective immediately.

Who is Parimatch?

Parimatch was founded in 1994 in Kyiv, Ukraine and expanded to Russia four years later in 1998.

Since then it has become an international gaming company Parimatch International, with three main branches: Parimatch LLC, Parimatch Foundation and Parimatch United Investments Limited.

In addition to this, many liaisons with various subsidiary companies.

Parimatch has shown its support towards Ukraine since the start of the Russian invasion, donating over $25 million in funds for aid for affected citizens, armed forces and healthcare.

It had also stated that all operations in Russia under Parimatch's jurisdiction would be ceased as of March 2022, just a week or two after the first attacks took place.

This has led to great confusion regarding the decision to sanction Parimatch in Ukraine.

What Led to Zelensky's Decision

It is believed that over 280 companies, of which subsidiaries and main branches of Parimatch as well as 120 individuals have been involved in withdrawing profits from Parimatch Ukraine which were being used to fund Russian schemes.

The automatic assumption the public has made is that of course, these schemes are majorly war-related.

What's most problematic about these allegations is that this would mean that money being invested on the online gambling platform from Ukrainian online gamblers, has been going towards funding the very war taking place in the country.

The design and announcement of these sanctions was no rash process, Zelensky added in his statement, saying that it was in the works for a very long time taking into consideration various factors.

It has also been specified that out of the 120 people known to have been directly involved in these activities against Ukraine, the majority are Russian citizens. However, a few Cypriots and Dutch nationals, among others, were also in the mix.

The Aftermath

Although compliant with the new sanctions, Parimatch has not stayed quiet and did bounce back following Zelensky's statement.

The company has directly addressed the president with their thoughts on this decision, appealing to his emotion by reminding us of all the people this decision affects.

Starting with the customers of Parimatch located in Ukraine, where Parimatch Ukraine is based.

As of the 10th of March, Parimatch ceased all activities in Ukraine and its official .ua website has been blocked. This means all players who had invested money on this website have no access to their own funds.

The company has reassured players that their funds have been frozen and that a legal refund mechanism is currently underway to return all this money to the casino's clients.

All Parimatch Ukraine employees have also suddenly found themselves unemployed as the company will no longer be operating in Ukraine and can therefore not sustain its team based in the country.

280 subsidiary companies are being sanctioned in accordance with the new law including Betcity, Sportloto and Bet.ru.

Parimatch has also gone as far as claiming that the allegations made against Parimatch Ukraine are in fact false and requests that the information on which this decision is based is reviewed.

In its address to Zelensky, Parimatch talks about how SBU - the Security Service of Ukraine, had never discussed the necessity of halting operations in Russia as of the start of the invasion.

It claims that in fact, the only times SBU contacted Parimatch, it felt threatening and intimidating.

Parimatch continued by saying that the company was also not informed of these sanctions and how they would affect all of Parimatch's clients and employees.

It is difficult to know whether Parimatch's statements are truthful considering the current political situation in the country, the relationship Ukraine has with Russia at the moment and the involvement of Russian citizens within the company.

All we know for sure is that as of three days, Parimatch has been suspended in Ukraine, however, the company seems hopeful that it will reinstall itself in the country successfully.