There are some major legislative changes on the horizon for the gaming industry in Bulgaria.

A new draft law currently being discussed is intended to modernise the market but there are fears that it could prove to be a considerable headache for operators there.

Nadia Hristova, member of the management board of the Bulgarian Trade Association of Manufacturers and Operators in the Gaming Industry, argued that one of the biggest challenges for the industry is coping with the massive tax hikes that came into force in January last year. This has resulted, she said, in the industry shrinking by about 20 per cent, with operators forced to make significant cut-backs in investment and staff.

Although new measures to tackle the growth of illegal online gaming would be welcomed, the changes to the legal framework for land-based operations under consideration seem counter-productive. Amendments to the law have been discussed over the past two years but only now is progress being made. Having been under new leadership for the last 12 months or so, the Bulgarian State Commission has been working to finalise plans for a new law that is still unlikely to be adopted any earlier than June next year.

"The land-based operators are facing unfair competition from the online companies operating in the Bulgarian market who work under no regulation and pay no taxes," Hristova told InterGaming. "That is why the regulation of online gaming is needed for the industry and in general the new draft law on gambling is a positive step towards modernising the legislation in Bulgaria.

"But any changes are needed also in light of the long-term vision of parliament for the development of the industry. Unfortunately some of the provisions in the new law do not reflect many possibilities for strategic long-term professional achievements for the industry within the international market but would just give it an opportunity to find a way to survive."

Some of these clauses in the draft law will cause the country’s gaming business to face a "serious crisis", she added, stating that one such provision will see all the licences issued under the existing law terminated after a period of 18 months and all operators will be required to apply for new ones.

"This is a crucial moment for the future development of the gaming industry in Bulgaria as a moment for regulatory change," added Hristova. "If the government is making its policy towards the industry as accepting it as a well developed and strictly regulated industry benefiting the economy of the country and adopt regulation that will give the industry an opportunity to develop a long-term business model, Bulgaria has a strong chance to be the best developed gaming destination in the Balkans."

A full update on gaming in the Balkans will be featured in the April issue of InterGaming.