Commentary on Article 307. Organization of Illegal Gambling Business of the Criminal Code of the Republic of Kazakhstan
1. The unlawful opening or operation of a gambling establishment, or the unlawful organization of activities in the field of gambling business, as well as the provision of premises for illegal gambling business, or the organization and conduct of gambling outside the locations established by the legislation of the Republic of Kazakhstan on gambling business, or the conduct of activities in the field of gambling business without a licence –
shall be punishable by a fine in an amount of up to two thousand monthly calculation indices, or corrective labour in the same amount, or community service for a period of up to six hundred hours, or restriction of liberty for a period of up to two years, or imprisonment for the same period, with confiscation of property.
2. The same acts committed:
1) involving a minor or with the participation of a minor in gambling;
2) by a group of persons acting by prior conspiracy;
3) with the extraction of income on a large scale;
4) by a person using their official position, –
shall be punishable by a fine in an amount of up to five thousand monthly calculation indices, or corrective labour in the same amount, or community service for a period of up to one thousand two hundred hours, or restriction of liberty for a period of up to five years, or imprisonment for the same period, with confiscation of property.
3. The acts provided for in Parts One or Two of this Article, committed:
1) by a criminal group;
2) with the extraction of income on an especially large scale;
3) by a person authorized to perform state functions, or a person equated to such a person, or an official, or a person holding a responsible public position, personally or through a trusted person, contrary to a prohibition established by law, where these acts are associated with granting privileges and advantages to such activities or providing patronage in another form, –
shall be punishable by imprisonment for a period of four to seven years, with confiscation of property, and in the cases provided for in paragraph 2), by imprisonment for the same period or a fine in the amount of ten to twenty times the amount of income received, with confiscation of property, and in the case provided for in paragraph 3), with lifelong deprivation of the right to hold certain positions or engage in certain activities.
The public danger of this crime lies in the uncontrolled spread of gambling that occurs when it is committed. In addition, the gambling business tax provided for in Chapter 66 of the Code dated 25 December 2017, “On Taxes and Other Mandatory Payments to the Budget” (the Tax Code), is not paid.
Taxes are understood as mandatory monetary payments to the budget, established unilaterally by the state in accordance with the law, except for cases provided for by the Tax Code, made in specified amounts and being non-refundable and gratuitous in nature.
The object of this crime is public morality.
The objective side of the crime consists of committing a number of alternative unlawful acts: 1) opening a gambling establishment; 2) operating it; 3) organizing activities in the field of gambling business; 4) providing premises for illegal gambling business; 5) organizing and conducting gambling outside the locations established by the legislation of the Republic of Kazakhstan on gambling business; 6) conducting activities in the field of gambling business without a licence.
The procedure for opening and operating gambling establishments is determined by the Law of the Republic of Kazakhstan dated 12 January 2007, “On Gambling Business”. Opening involves selecting premises, recruiting employees of the gambling establishment and taking other actions necessary for the operation of the gambling establishment. The opening of a gambling establishment in violation of the law, in particular, in prohibited locations, without registration, in the absence of a licence, etc., should be considered unlawful. The law permits casinos and slot machine halls to be opened only in two locations: in the Almaty Region on the shore of the Kapshagai Reservoir and in the Shchuchinsk District of the Akmola Region, within the territory determined by local executive bodies (paragraph 1 of Article 11 of the aforementioned Law). Opening them in other locations is recognized as unlawful.
According to subparagraph 15) of Article 1 of the Law of the Republic of Kazakhstan “On Gambling Business”, a gambling establishment means a building, premises or structure in which gambling and (or) betting involving the receipt of winnings are conducted in accordance with the requirements established by this Law.
Gambling business means entrepreneurial activity associated with the organization and conduct of gambling and (or) betting (subparagraph 11) of Article 1 of the Law).
A gambling game is a risk-based agreement providing for winnings, concluded between participants or between participants and the gambling business operator, concerning the outcome of an event in which the said persons participate (subparagraph 7) of Article 1 of the Law).
A casino is a gambling establishment in which gaming tables are used to organize and conduct gambling (subparagraph 5) of Article 1 of the Law).
Gambling business is entrepreneurial activity associated with the organization and conduct of gambling and (or) betting (subparagraph 11) of Article 1 of the Law).
A bet is a risk-based agreement concluded between participants or between participants and the gambling business operator concerning the outcome of an event in which they do not participate and which provides for winnings (subparagraph 2) of Article 1 of the Law).
Winnings mean a property benefit that must be paid to a participant in gambling and (or) betting upon the occurrence of the outcome of gambling and (or) betting provided for by the rules established by the gambling business operator (subparagraph 21) of Article 1 of the Law).
A gambling business operator is a legal entity that organizes and conducts gambling and (or) betting in accordance with the requirements established by the legislation of the Republic of Kazakhstan (subparagraph 12) of Article 1 of the Law).
Opening a gambling establishment involves taking actions aimed at ensuring its operation, i.e. providing customers with access to it, conducting gambling, concluding bets, accepting stakes, paying winnings, operating gaming machines, etc.
In accordance with Article 6 of the aforementioned Law of the Republic of Kazakhstan, the following types of activities are carried out in the field of gambling business:
casino;
slot machine hall;
bookmaker's office;
totalizator (paragraph 1).
The following are prohibited in the territory of the Republic of Kazakhstan:
conducting types of activities in the field of gambling business not provided for in paragraph 1 of the aforementioned Article;
the activities of electronic casinos and internet casinos;
organizing and conducting gambling and (or) betting involving the acceptance of stakes and (or) the issuance of winnings in the form of property other than money, with the exception of casino activities, where the issuance of winnings in the form of other property is permitted;
installing and using gambling equipment for business purposes, except in the locations provided for in paragraph 1 of Article 11 of this Law;
concluding bets, accepting (recording) stakes on bets, and paying winnings on bets outside bookmaker's offices and totalizators (cash desks of bookmaker's offices and (or) totalizators);
concluding bets, accepting (recording) stakes and paying winnings by persons who are not gambling business operators carrying out the activities of a totalizator or bookmaker's office;
organizing and conducting gambling and (or) betting under the guise of prize draws aimed at stimulating the sale of goods (works, services);
organizing and conducting bets on events generated by software and (or) through the use of equipment (mechanical, electrical, electronic or other technical equipment) and (or) any visualization of an event, except for its direct broadcast;
providing payment services in favour of foreign gambling business operators whose activities have been recognized as unlawful in the territory of the Republic of Kazakhstan on the basis of a judicial act (paragraph 2).
The operation of such an establishment is understood as taking actions aimed at maintaining it in working order, i.e. providing technical maintenance of gaming machines, expanding the customer base, cleaning the premises and the adjacent territory, paying staff wages, ensuring the functioning of utility networks, security and communication systems, etc.
Activities in the field of gambling business are subject to licensing. In this regard, conducting such activities without a licence constitutes a criminally punishable act.
By its legal structure, this corpus delicti is formal, i.e. it is considered completed from the moment at least one of the listed acts is committed.
From the subjective side, the act is committed with direct intent: the perpetrator realizes that they are committing unlawful acts in the field of gambling business and desires to do so.
The subject of the crime may be a sane natural person who has reached the age of 16.
Part 2 of Article 307 of the Criminal Code provides for the following qualifying elements: 1) involving a minor or with the participation of a minor in gambling; 2) by a group of persons acting by prior conspiracy; 3) with the extraction of income on a large scale; 4) by a person using their official position.
The use of a minor in gambling should be understood as the participation of a minor in the process of conducting gambling in any role, including as an employee of a gambling establishment. Participation in gambling means taking part in it as a player or another participant. In order to qualify a crime under these two elements, it must be established that the person who committed the crimes commented on in this Article knew that their employee or the participant in the gambling was a minor.
The elements of a group of persons acting by prior conspiracy are explained in the commentary to Part 3 of Article 297 of the Criminal Code.
According to subparagraph 38) of Article 3 of the Criminal Code, income on a large scale under Article 307 of the Criminal Code means income whose amount exceeds one thousand monthly calculation indices.
A person using their official position in the field of illegal gambling business is a person performing their functions in a commercial or other organization.
According to subparagraph 19) of Article 3 of the Criminal Code, a person performing managerial functions in a commercial or other organization means a person who, permanently, temporarily or under special authority, performs organizational and administrative or administrative and economic duties in an organization that is not a state body, a local self-government body or an organization in which the state's share exceeds fifty percent.
A commercial organization may be established only in the form of a state enterprise, business partnership, joint-stock company or production cooperative, while a non-profit organization may be established in the form of an institution, public association, joint-stock company, consumer cooperative, foundation, religious association or another form provided for by legislative acts (paragraphs 2 and 3 of Article 34 of the Civil Code).
In the case of illegal gambling business, a person, using their official position, opens or operates a gambling establishment, or organizes activities in the field of gambling business, as well as provides premises for illegal gambling business, or organizes and conducts gambling outside the locations established for gambling business, or conducts activities in the field of gambling business without a licence.
Part 3 of Article 307 of the Criminal Code specifies the particularly qualifying elements: 1) a criminal group; 2) extraction of income on an especially large scale; 3) commission by a person authorized to perform state functions, or a person equated to such a person, or an official, or a person holding a responsible public position, personally or through a trusted person, contrary to a prohibition established by law, where these acts are associated with granting privileges and advantages to such activities or providing patronage in another form.
For the elements of a criminal group, see the commentary to Part 4 of Article 297 of the Criminal Code.
According to subparagraph 3) of Article 3 of the Criminal Code, income on an especially large scale under Article 307 of the Criminal Code means income whose amount exceeds five thousand monthly calculation indices.
Paragraph 3) of Part 3 of Article 307 of the Criminal Code provides for a special subject. Such a subject may only be a person authorized to perform state functions, or a person equated to such a person, or an official, or a person holding a responsible public position, if they commit the crime in question personally or through a trusted person. The definitions of the concepts of a person authorized to perform state functions, a person equated to such a person, an official, and a person holding a responsible public position are provided in subparagraphs 16), 26), 27) and 28) of Article 3 of the Criminal Code. In addition, in order to apply paragraph 3) of Part 3 of Article 307 of the Criminal Code, it is necessary to establish that the perpetrator acted contrary to a prohibition established by law and that the acts listed in the disposition of the Article are associated with the granting of privileges and advantages to such activities or the provision of patronage in another form by the person found guilty.
Conducting activities in the field of gambling business without a licence is similar to illegal entrepreneurship and illegal banking, microfinance or collection activities (Article 214 of the Criminal Code). The difference is that Article 214 of the Criminal Code is a general provision in relation to Article 307 of the Criminal Code. According to Part 3 of Article 13 of the Criminal Code, in the event of competition between a general and a special provision, criminal liability arises under the article of the Special Part of the Criminal Code containing the special provision, that is, under Article 307 of the Criminal Code.
In addition, the corpus delicti provided for in Article 307 of the Criminal Code is formal, whereas the corpus delicti provided for in Article 214 of the Criminal Code is material, since criminal liability requires the occurrence of consequences in the form of causing substantial damage to a citizen, organization or the state, or the perpetrator's act must be associated with the extraction of income on a large scale or the production, storage, transportation or sale of excisable goods in significant quantities.
The act provided for in Part 1 of Article 307 of the Criminal Code is classified as a criminal misdemeanor.
The act provided for in Part 2 of Article 307 of the Criminal Code is classified as a crime of medium gravity.
The act provided for in Part 3 of Article 307 of the Criminal Code is classified as a serious crime. In addition, in order to apply paragraph 3) of Part 3 of Article 307 of the Criminal Code, it is necessary to establish that the perpetrator acted contrary to a prohibition established by law and that the acts listed in the disposition of the Article are associated with the granting of privileges and advantages to such activities or the provision of patronage in another form by the person found guilty.
Conducting activities in the field of gambling business without a licence is similar to illegal entrepreneurship and illegal banking, microfinance or collection activities (Article 214 of the Criminal Code). The difference is that Article 214 of the Criminal Code is a general provision in relation to Article 307 of the Criminal Code. According to Part 3 of Article 13 of the Criminal Code, in the event of competition between a general and a special provision, criminal liability arises under the article of the Special Part of the Criminal Code containing the special provision, that is, under Article 307 of the Criminal Code.
In addition, the corpus delicti provided for in Article 307 of the Criminal Code is formal, whereas the corpus delicti provided for in Article 214 of the Criminal Code is material, since criminal liability requires the occurrence of consequences in the form of causing substantial damage to a citizen, organization or the state, or the perpetrator's act must be associated with the extraction of income on a large scale or the production, storage, transportation or sale of excisable goods in significant quantities.
The act provided for in Part 1 of Article 307 of the Criminal Code is classified as a criminal misdemeanor.
The act provided for in Part 2 of Article 307 of the Criminal Code is classified as a crime of medium gravity.
The act provided for in Part 3 of Article 307 of the Criminal Code is classified as a serious crime.
Commentary to the Criminal Code of the Republic of Kazakhstan, 2021, by Isidor Shamilovich Borchashvili, Honoured Figure of Kazakhstan, Doctor of Law, Professor, Academician of the Kazakhstan National Academy of Natural Sciences, member of the Scientific Advisory Councils under the Constitutional Council of the Republic of Kazakhstan and the Supreme Court of the Republic of Kazakhstan, member of the working group on reform of the law enforcement system under the Security Council of the Republic of Kazakhstan, Honoured Employee of the Ministry of Internal Affairs of the Republic of Kazakhstan.
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