Clients of Baccara Casino make stakes at the roulette
Photo: Yury Martyanov
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Moscow City Duma Deputies Go at One-arm Bandits
// Lawmaking
Moscow City Duma deputies passed in yesterday’s second reading a law prohibiting stationing amusement arcades and casinos closer than 500 meters to residential houses, kindergartens and schools, and placing game machines outdoors. The participants of the market with the annual turnover of over $1 billion predict that if the bill is enacted as it is 60 percent of game machines will be banned, which will cause a surge of businessmen’s lawsuits against the city authorities.
The functions of the licensing of casinos and amusement arcades were delegated to the Federal Physical Training, Sports, and Tourism Agency from the local authorities in 2002, under the Russian Government’s decree. Since then the city authorities persist in regaining the control over the gambling industry. Moscow mayor Yuri Luzhkov sent letters to President Putin and the Russian Government demanding returning the licensing to the local level, but got no reply. The deputies of the Moscow legislature came forward with the same demands this June. They appealed to Prime Minister Mikhail Fradkov asking him to put a halt to an “uncontrolled” growth in the number of game machines by returning the control over the gambling industry to the Moscow authorities, and staged an “anti-gambling” picket by the House of Government. The Moscow lawmakers promised to draft a local law restricting the activities of gambling houses. It is peculiar that licenses for casinos are not issued now, as the Federal sport agency was stripped of these powers in November 2005. The Trade and Economic Development Ministry now insists on delegating the licensing functions to the Federal Tax Service.
Moscow hosts 56 casinos, over 2,000 arcades and more than 60,000 game machines. The turnover of the city gambling machines market exceeds $1 billion per year.
Moscow deputies consider yesterday a bill On the Stationing of Establishments of the Gambling Industry in the territory of Moscow. The initial version of the document was to impose severe restrictions on the industry. The number of the casinos in Moscow was planned to be reduced to 30, the number of arcades – down to 4 in every Moscow district. However, Moscow Prosecutor’s Office opposed the explicit restrictions, the author of the bill deputy Andrey Metelsky says. Thus, yesterday’s first reading saw a new version of the bill that proposes to set the maximum number of gambling houses by the Moscow government’s decree. Besides, gambling houses are proposed to be stationed no closer than 500 meters of schools, kindergartens, hospitals and dwelling houses. Game machines “outdoors”, i.e. in the streets, are to be banned. “We must prohibit “the step accessibility” of these institutions and secure the rights of the citizens who play through their salaries, pensions and apartments,” Mr. Metelsky said. His colleagues doubted the effectiveness of the bill, though. Deputy Evgeny Balashov claimed that it was profitable for authorities to rent out premises for gambling house, while deputy Irina Runina insisted that gambling machines remain within 25 meters of Metro stations, despite the ban of the city government. Mr. Metelsky suggested that the amendments to the bill be included. There is likely to be a lot of them. Deputy Yuri Popov, for example, remarked that should be the bill be enacted, one will not be able to install gambling machines in dwelling houses, while one will be able to make it in “the city hall, at the post office or at the Moscow City Duma”. Deputy Lyudmila Stebenkova suggested the removal of all gambling industry altogether outside Moscow. The draft was passed in the second reading, while its amending will be continued in autumn.
The market watchers claim that if the bill is enacted as it is 60 percent of the gambling machines market will be under ban. “500-meter zone is an ill-considered idea, as the density of housing development is very high in some districts. The bill also does not explain the mechanism of the removal of the existing house from these zones and the mechanism of indemnity,” says Stanislav Bartnikas, marketing director of Ritzio Entertainment Group that operates Vulkan chain of gambling houses. The director general of Jackpot game system German Goglichidze shares this opinion. “The law must work, but not build ill-considered barriers. I hope it will be reviewed.” Mr. Bartnikas also doubts that the law can take its toll on gambling houses that have their own premises. “It is only the federal authorities who have the right to make them go out of business, all the rest would contradict the business law,” Mr. Bartnikas stated. “Otherwise, businessmen will bring the authorities to court and win their lawsuits.”
Alexander Voronov
All the Article in Russian as of June 30, 2005
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