Kambi released an update Thursday that its contract with National Lottery AD from Bulgaria had been placed under temporary suspension, halting its sports book operations for the 7777 betting brand with immediate effect.
Kambi Group issued a formal notice to National Lottery AD, informing them the restrictions for placing bets through the 7777.bg sports betting website owned by the latter and powered by Kambi’s operations were with immediate effect.
Partnership Looked Promising
Back in July 2017, National Lottery AD chose Kambi to power the sports betting operations on the aforementioned 7777 website, in an attempt to upgrade its product offerings to enhance its ability to become the domestic market leader in sports betting.
In February 2018 the Swedish Nasdaq-traded Kambi went live in Bulgaria, with sports betting complementing the market-leading gaming and lottery offerings of the Bulgarian company. Under the agreement, the Bulgarian gaming website took full advantage of Kambi’s full product suite, including Bonus Toolbox, fully adaptable frontend, Price Differentiation tool and real-time player data feeds.
“National Lottery AD is a major player in the local Bulgarian market so we are very pleased to have launched our Sportsbook alongside its popular 7777 brand”
Max Meltzer, Chief Commercial Officer, Kambi Group
Lottery Becomes State Monopoly
The current development followed the voluntarily handing back of its license by National Lottery AD to the State Gambling Commission, after in February the Bulgarian National Assembly passed a bill to amend the 2012 Gambling Act and prohibit private companies from offering lottery products, essentially making the lottery business a state monopoly.
The amendment left raffle, bingo and keno games as the only options for private companies and gave all live operators no transition time to cease operations, forcing them to do so at the moment the amendment was published in the Official Gazette of the country.
Social Concerns Behind The Amendment
The amendment was proposed due to political officials raising the issue that scratch card lottery had taken over the country, going into epidemic proportions especially with the most vulnerable social groups, with one social agency report stating that 57% of Bulgarian people had been engaged into scratch card lottery-type gambling.
Bulgaria’s gambling industry has been estimated to be the second biggest in the EU after Malta’s, with 100 million scratch cards sold in 2017, and the country is the only member of the EU where there is no obligation for lottery operators to donate a portion of their profits to good causes.
Despite lottery and scratch cards ads being effectively banned, operators found a way around it by showing interviews with winners in the TV slots for commercials, turning themselves into the biggest advertisers on TV in 2017.
Some unconfirmed reports stated that National Lottery’s bank accounts had been impounded by the National Revenue Agency as the company was on the brink of bankruptcy, even its owner arrested, meaning the suspension of contract might be permanent, but the sports betting services provider to regulated operators including names such as William Hill, Kambi Group, explained a small negative impact on 2020 revenue was expected.