Gambling has arrived in the United Arab Emirates

The United Arab Emirates (UAE) has been planning to legalise gambling for some time. Initially only intended for tourists, the project has slowly but surely developed further and further. Following the establishment of a regulatory authority in late summer 2023, the time had come at the end of July 2024: gambling arrived in the UAE with the licensing of a nationwide lottery.

In the Arab world, gambling has traditionally been treated as a taboo subject, which makes the UAE's recent decision to issue a lottery licence all the more remarkable. It marks a significant turning point in the country's social and economic development. Despite the deeply rooted religious and cultural norms that classify gambling as ‘haram’, i.e. forbidden under Islamic law, the UAE has positioned itself as a pioneer of a new, more pragmatic and business-orientated approach in the Middle East for several years.

In this field of tension between tradition, modernity and development, the General Commercial Gaming Regulatory Authority (GCGRA) issued the first lottery licence in the UAE at the end of July 2024. The licence holder is The Game LLC, a locally based company that has already established itself in the online gaming sector. This decision not only represents an economic advance that overrides certain historical views. It could also be seen as a test balloon for further liberalisation in the UAE's gaming sector, which may gradually evolve into a legalised market to open up new revenue streams and further promote tourism.

What does the UAE Lottery offer and who is behind it?

So far, there is not too much information to suggest what players can expect from the new lottery. An exact date for the launch has also not yet been given.

Little concrete information in the official statement

The official press release only makes it clear that The Game LLC will operate the lottery under the name ‘UAE Lottery’ and ‘will offer a wide range of lottery games and other games to suit the different interests and financial preferences of players’. The item ‘other games’ suggests that at least not only conventional lottery is planned.

Basically, the GCGRA, together with the new licence holder, is striving to ‘establish a well-regulated commercial gaming sector in the UAE based on the principles of transparency, accountability, consumer protection and responsible gaming practices’.

Further details only via insiders

As reported by the international trade press, more detailed regulations for the lottery are not publicly available at this time. However, executives in charge of development have reportedly stated that payout rates will be between 40 and 60 per cent of ticket sales. An ‘interesting single-digit’ tax would be levied on the revenue - in addition to the UAE's nine per cent corporate tax. The Game LLC would also have to pay a licence fee, described by one source as high but reasonable for a licence that lasts over 10 years.

And who is behind the company with the (in this context) not very meaningful name ‘The Game LLC’?

The press release also provides little information to answer this question: It merely states that it is ‘a commercial gaming operator specialising in game development, lottery operations and gaming-related content’.

The Game LLC has not yet commented on the licence award - and it remains unclear when it plans to launch the UAE lottery.

What is curious about the cooperation with The Game LLC is the fact that the two best-known lottery operators in the UAE, Emirates Draw and Mahzooz, did not stand a chance against the ‘nobody’ when it came to awarding the licence. Both companies told international media outlets that they were actually much better suited for the licence due to their experience in the market and existing player base.

Outlook: Where will gambling in the UAE go next?

Following the granting of the first lottery licence, the GCGRA has two further major gambling issues to deal with:

1. The licensing of integrated casino resorts.
2. The introduction of a regulated iGaming market.

On the second point, there is not much more than speculation so far. Numerous people in the UAE also gamble with unregulated providers of digital slots and casino games in the international arena. It cannot be ruled out - especially in view of the current developments surrounding the new lottery - that this area will also be liberalised and channelled towards officially approved platforms sooner or later.

In terms of land-based facilities, construction of the Wynn casino resort in Ras Al-Khaimah is still underway (although it is not yet clear when it will receive its licence). We reported back in December 2022 that Wynn Resorts had confirmed the construction of its first casino in Dubai, with the opening scheduled for 2026. Other major operators are still in the planning phase, so Wynn officials expect to have a very lucrative first mover advantage for a few years.

According to the international trade press, the CEO of MGM Resorts, Bill Hornbuckle, has also confirmed his interest in the UAE market. It is also assumed that big players such as Caesars and Macau are positioning themselves for an ‘attack’.

Conclusion

Image source: https://pixabay.com/photos/dubai-skyline-uae-emirates-5639178/