EASTERN EUROPE MARKET REPORT ROMANIA
Population: 21.8m Under 15: 3.2m 15-64: 15.4m Urban population: 57 percent Major cities: Bucharest (2.2m), Constanta (450,000), Iasi (400,000) GDP per capita: $12,600 Business climate: Romania only joined the European Union in 2007, the same year the country saw a major rise in inflation. More recently, as a result of the global financial disaster, its GDP fell by more than seven percent in 2009, which led the government to go cap in hand to the IMF, the EU and other lenders to the tune of $26bn. Austerity measures, part of the lending agreement, resulted in a 1.3 percent GDP contraction in 2010. Positive growth in 2011 came thanks to strong exports, but the country is not out of the storm yet; a precautionary 24- month standby agreement, valued at $4.9bn, has been signed by Romania and the IMF, EU, andWorld Bank, to provide a cushion if required. However, the Romanian government has gone on record saying it does not intend to use the facility.
The Romanian government regulates lottery, parimutuel betting, sports betting, slots, bingo halls, televised bingo – which is very popular – and online gaming. The last is not a functioning market as yet, with the gaming industry awaiting tweaks to the law before it comes to pass. Meanwhile, televised bingo is about to disappear from Romanian TV screens too, with a recent draft law likely to bring about its demise fairly rapidly, although there is only one licence in operation. The country has both VLTs and AWP machines, with about
6500 VLTs and just under 50,000 AWPs. The VLTs are operated by the state-owned National Lottery, while the type of venue a slot/AWP is in dictates the number of machines on-site. For example, if you’re running a slot arcade, you must have a minimum of 15 machines; for a site where there are economic activities other than gambling, such as a bar, you may have three to five machines; and sites authorised for betting or lotto activities are permitted two to five machines. The Romanian slot
scene has been in decline since 2010, when there were 409 operators in the
22 APRIL 2013
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market, with 49,949 machines in operations of varying size, from less than 50 machines per site up to more than 1000 per site. In December 2011, the number of operators was down to 402, with a relatively large drop in the number of machines to 46,861. All operators are required to pay for a licence, which costs
around ¤5500, plus an extra ¤1800 per machine. Tax levels were raised dramatically in 2009, with the tax per slot rising to more than four times its previous level. This enormous hike led to a dramatic fall in the number of operators in the country, from some 1200 operators in the first half of 2009, to around 400 by the following March. Additionally, the end of 2010 saw Romslot and AOPJNR, the
country’s main gaming associations, reach an agreement that would do away with a tax on players’ winnings in favour of an entrance fee for slot halls and casinos; the government, however, actually ended up using both, a move which has beleaguered an already-struggling industry. The Romanian gaming industry is lobbying the government
hard for change, as the market is barely clinging to existence, never mind growing. The 2012 Romanian Gambling Conference saw several measures proposed, including: • Clearing the black market for gaming by introducing official plaques at entrances to licensed gaming areas, and notifying authorities of the movement of games, so the old location can be cancelled as a licensed area where appropriate.
• Removing the entry charge for venues. • Establishing a slot regulatory body, including representatives from the government.
• Preventing the misinterpretation of rules allowing for corruption at a localised level.
Unlike many countries where the industry has been injured by
the introduction of a smoking ban, however, the Romanian gaming sector seems confident that a proposed ban will not come to fruition; the proposal came from a member of parliament, but the move was apparently blocked and is unlikely to see the light of day.
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