Table of Content
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Introduction
The government of Sri Lanka has announced that it intends to have a dedicated gambling regulator—the Gambling Regulatory Authority (Sri Lanka) (GRA)—up and running by 30 June 2026. The legislation to establish the authority has already been passed.
Why This Move?
Sri Lanka has been operating a very fragmented regulatory regime for gambling, with separate old‑ordinances for horse‑racing betting, casinos and gaming. Online gambling remains illegal but widely used via offshore platforms — estimates suggest 60–70% of sports bettors in Sri Lanka use unregulated offshore sites.
By creating a single statutory regulator, the country aims to:
By creating a single statutory regulator, the country aims to:
- Establish licensing mechanisms, operational conditions and enforceable penalties for non‑compliance.
- Capture tax revenue from what is currently a grey market (offshore/unregulated) of gambling.
- Enhance transparency, oversight and governance of the sector.
- Boost tourism and reposition Sri Lanka as a higher‑end gaming/entertainment destination, aimed particularly at visitors from India and China.
What Will the Regulator Cover?
- The GRA will act as a “one‑stop shop” regulator overseeing casinos, betting operations (land‑based and possibly digital) and licensed gambling activities.
- It will not immediately cover state lotteries or some social games (non‑profit, informal) in its primary scope.
- Current laws—the Betting on Horse‑Racing Ordinance (Chapter 44), the Gaming Ordinance (Chapter 46) and the Casino Business (Regulation) Act (No.17 of 2010)—will be repealed and consolidated under the new law.
- The regulator will be empowered to handle licensing, monitor compliance (including AML/CTF standards), impose penalties and enforce giveaways of illicit/unlicensed activities.
Implications for Stakeholders
- For operators: The introduction of a formal regulator signals that the market is becoming more structured. Licensing pathways will bring legal clarity, but also new compliance burdens.
- For the government/tax authorities: The regulator is meant to help the state capture revenue previously lost to unregulated offshore or informal gambling.
- For consumers: Eventually, this should mean stronger oversight of fairness, protection from illegal operators, and more transparent operations.
- For offshore/unlicensed operators: They may face increased risk of enforcement, blocking or legal action as the regulator becomes operational.
- For tourism and the wider economy: The move fits into Sri Lanka’s strategy of leveraging integrated resorts and casino‑led tourism to drive growth.
Key Challenges Ahead
- Implementation: Passing legislation is one thing; building the regulatory infrastructure (staff, systems, rules, enforcement) is another and can take time.
- Regulating online gambling: While the law covers digital platforms in broad terms, enforcement of offshore sites is technically complex (payment systems, cross‑border issues, VPN/ISP blocking). Experts have flagged gaps in the draft legislation.
- Balancing growth and social/legal concerns: With increased gambling activity, issues of problem gambling, AML/CTF risk, money laundering and social harm become more salient. The regulator will need to incorporate responsible gambling measures.
- Credibility and independence: Some commentators have raised concerns about whether the regulator will be truly independent and robust enough to meet international best practices.
Is Your Business Ready for Sri Lanka’s Gambling Regulator?
How This Compares Regionally
The move by Sri Lanka reflects a broader trend in the Asia‑Pacific region: rather than outright bans, many countries are moving toward regulated frameworks to bring gambling (especially online) into the formal economy. The Sri Lankan model may take cues from jurisdictions such as Singapore.
Conclusion
The establishment of a formal gambling regulator in Sri Lanka marks a pivotal moment for the country’s gaming industry. By committing to a more structured, transparent and enforceable regulatory regime, Sri Lanka is laying the groundwork for a new era of casino‑ and resort‑led tourism, investment and revenue growth.
For operators, investors and service‑providers, the window is opening—but so too are the expectations for compliance, governance and risk management. At AIS Technolabs, we specialise in helping firms navigate complex regulatory landscapes, build compliant gaming platforms, integrate responsible‑gaming tools and position for market entry. If you’re looking to capitalise on Sri Lanka’s evolving gaming ecosystem, contact us to explore how we can support your journey.
Disclaimer
This blog is intended for informational and educational purposes only. We do not promote or facilitate gambling activities in any country where it is considered illegal. Our content is focused solely on providing knowledge about legal and regulated markets. We only work with operators and platforms that are licensed and comply with the laws of jurisdictions where casino gaming is permitted. We do not operate or endorse any form of gambling in restricted regions. In countries where only skill-based games are allowed, our involvement is strictly limited to those games.
We believe gambling should be an entertaining and responsible activity. Our goal is to ensure that the platforms we review uphold the highest standards of fairness, transparency, and player safety.
FAQs
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The target launch date for the GRA is by 30 June 2026.
Ans.
Not immediately. The new law covers casinos, betting operations and related licensed activities, but excludes state‑run lotteries and certain social games (non‑profit/hobby‑based).
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No — online gambling is currently illegal under existing laws. However, a large proportion of local bettors are reported to use unregulated offshore sites.
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Among the benefits:
- Improved tax revenue capture and reduction of grey‑market activity
- More robust governance of gambling operations (licensing, compliance, consumer protection)
- Increased investor confidence, particularly in tourist‑oriented integrated resorts
- Social safeguards via responsible gaming and anti‑money‑laundering rules
Ans.
It means that the regulatory regime is evolving, so early movers may have advantage in positioning for licensing. But they will also need to watch for changes in regulation, compliance burdens and possibly increased entry fees or tax/toll structures.
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Potential risks include:
- Regulatory delay or weak enforcement in online/offshore segments
- Possible lack of true independence of the regulator, which may affect credibility
- Social or political push‑back if gambling growth is perceived as harmful
- Compliance cost and reputational risk for operators entering too early without full clarity
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The market is still emerging but has significant potential: The country already has seven casinos licensed (one major integrated resort plus six smaller gaming halls). The push to attract high‑spending tourists from India and China adds to the appeal.
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