Should the government tackle gambling at the expense of jobs?

On Wednesday morning a crowd accosted lawmakers entering the National Assembly ahead of a parliamentary hearing over a proposal to further restrict gambling. The protesters, most of whom are employees of Goodwin Bet LLC, a local chain of betting parlors, called on the MPs to delay the vote.

The controversial bill, which was announced back in October of last year, aims to further restrict access to gambling premises across the country. The language of the draft bill would severely restrict the activities of all physical betting institutions outside of designated zones in an attempt to discourage irresponsible underage gambling.

If implemented, this law would be the latest in a series of increasingly strict regulations placed on the country’s gambling institutions over the past two decades.

Gambling has become a major socioeconomic issue for the newly independent country, as desperate, impoverished people lured by the promise of riches, lose their life savings to bad luck. The addiction is destroying families; some have been attributing it to a spike in suicides.

A succession of government attempts to reign in the casinos, long suspected of serving as money laundering fronts for government-connected oligarchs has seen these institutions first relegated to locations beyond Yerevan’s city limits, and subsequently confined to the three designated resort of towns Tsakhkadzor, Sevan and Jermuk. Betting licenses and taxes for play houses have also been hiked several times, while a recent law raised the legal gambling age from 18 to 21. Penalties for underage gambling have been strengthened as well.

This latest bill would entail the removal of all brick and mortar casinos including betting parlors across the country, putting several thousand jobs in danger. Goodwin Bet LLC, which operates hundreds of physical booking parlors across the country, is expected to take the biggest hit.

Back in April, Goodwin CEO Sarkis Mikaelyan agreed to remove all sweepstakes, lottery booths and electronic gambling machines from gas stations and other public areas despite an estimated 50-percent loss in profits for his company. The government refused his request for a one-year delay. Mikaelyan has criticized the harsh tone of the proposed bill which he says would put him out of business and thousands of people out of work. Deputy Speaker Alen Simonian, who sponsored the bill also dismissed this claim, accusing the CEO instead of scaremongering his own employees, since the automated gambling machines do not require humans to operate them.

Other betting parlors would be much less severely affected since they have mostly made the switch from brick and mortar to online gambling portals. This has led some Goodwin employees to ponder if this new law would not be intended to consolidate monopoly on gambling in the country around competitor BetConstruct.

BetConstruct, originally conceived as a similar booking parlor under the VivaroBet brand has grown into Armenia’s largest tech company and one of the top 10 providers of online betting software in the world. It has also diversified its business interests into sports-centered news portal VivaroNews and website building tool SoftConstruct.

A major concern with the bill is that it’s targeting the wrong sort of gambling institution. With the tougher penalties on underage betting in place since last year, customers are required to show government ID when entering physical booking parlors. Critics argue that underage gamblers face no restrictions when using betting apps on their parents’ smartphones tied to the family credit card.

Among the estimated 500 protesters, a man explained to the Weekly that he agrees with the law in principle, but argues that it has been drafted too hastily. “They should have allowed a year’s grace period in order for the company to comply with the new regulations,” he said.

Prime Minister Nikol Pashinyan met with the protesters two weeks ago where he promised to consider their suggestions and return with a solution. The protesters say he has yet to get back to them.

A woman holding a banner told the Armenian Weekly that she was protesting to save her son’s job. “My son is the only breadwinner in our family,” she said. “He earns enough to keep us all going.” Then she looked down at a four year-old girl wrapped around her leg and sighed, “What will become of my granddaughter with her father unemployed?” she lamented.

By midday, the protesters finally unblocked Baghramyan Avenue to traffic after chairman of the parliament committee, Babken Tunian agreed to hear their concerns in person.

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Raffi Elliott

Columnist & Armenia Correspondent
Raffi Elliott is a Canadian-Armenian political risk analyst and journalist based in Yerevan, Armenia. A former correspondent and columnist for the Armenian Weekly, his focus is socioeconomic, political, business and diplomatic issues in Armenia.

4 Comments

  1. Thanks Raffi for bringing attention to this scourge that has plagued a number of Armenian citizens and has caused social havoc and misery in many families.
    I used to think when I first arrived that casinos were placed near the Zvartnots airport (EVN) because most gamblers were foreigners who flew-in from other countries in the region.
    Well, I have since learned of the addiction of many Armenian citizens.
    As for the employees fearing for their jobs, perhaps they could join a tobacco company :-)

  2. I stopped gambling 50 years ago, “cold turkey”. Today, at 83, I have a house, car and money for my retirement. If I did not stop gambling, I could have become a gambling addict and my “vijug” meaning my situation could have been a disaster. Another addictive habit of smoking is a killer. My Father Harry would tell smokers “you smoke, you crook”. My Father stopped smoking at 60, lived to 94. So kids, no gambling, no getting drunk, no smoking, no drugs, and no vulgar talk. All it takes is will power and ARMENIAN POWER.

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