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. Last Updated: 07/27/2016

Deputies Tempt Fate With New Lottery Law

The State Duma on Tuesday passed in a crucial second reading a law on lotteries that will be the first in Russia to regulate the luck industry if eventually signed into law.

Estimates vary, but it is thought that Russians spend up to $400 million per year on various types of lotteries run by between 150,000 and 250,000 companies throughout the nation -- all of which operate without any legal oversight.

Currently, the Finance Ministry is empowered to issue lottery licenses, but it has neither a special department to deal with the issue nor any hard and fast rules about who is entitled to receive them.

"Some companies receive a license and some don't, but the Finance Ministry never explains why in either case," said Boris Kruglyansky, vice president of Interlot, which conducts the Zolotoi Klyuch television lottery and is lobbying for the bill's passage.

Kruglyansky said the most important thing to have in his business is ground rules.

"Now, there is no register to identify lottery operators and nobody to look for them if they cheat," he said.

The deputy head of the Duma's budgetary committee, Vitaly Shuba, who helped draft the bill, said the law is designed to bring order and "world-class standards" to the industry and create an "effective government mechanism for attracting voluntary funds from lottery participants."

The ultimate goal, Shuba told RIA Novosti, is to use at least 10 percent of all lottery revenues to help fund "socially significant" projects for culture, sports, science and health.

Although this is the seventh attempt to pass a bill to regulate lotteries, Shuba said this one differs in that it is based on several years' analyses of other countries' experiences.

Among other things, the bill would create a unified state register of lottery operators.

The bill does not specify which federal body will be responsible for regulating the industry, but it does lay out the requirements to obtain a license as well as spell out the rights lottery participants do and do not have.

As for the prospects of the bill becoming law, Kruglyansky admitted it would take a little luck.

"Once a draft law got to a third reading, but [then-President Boris] Yeltsin vetoed it, so it's too early to say we are happy."

The world lottery market is estimated to be worth between $150 billion and $160 billion per year. Americans lead the way, spending $30 billion per year, followed by the Japanese at $8 billion per year and the Germans, who spend $6 billion.