No independence, no integrity: Why Sri Lanka’s gambling law is under fire
As Sri Lanka rushes to establish its Gambling Regulatory Authority ahead of the high-profile launch of Melco Resorts & Entertainment’s City of Dreams Sri Lanka on 2 August, sharp criticism is mounting over the proposed bill’s lack of independence, inadequate safeguards, and its potential to become a political tool.
The government is expediting the Gambling Regulatory Authority Bill to ensure a regulatory framework is in place before the formal opening of Melco’s integrated resort in Colombo’s Cinnamon Life complex. But critics argue that this urgency has come at the cost of regulatory credibility.
“I think the government is trying to push this bill through in a rush because Melco is coming next month,” said Sudaraka Ariyaratne, Research Consultant at Colombo-based think tank, Advocata Institute. “We think Melco would’ve wanted a regulator in place. When it comes to these big names in the gaming industry, the integrity of the market is a big consideration, given the image of the industry as a whole.”
“Even if it’s not a proper regulator, as long as it gives the perception of integrity, that’s what they are looking for, to engender market confidence. The danger with this bill is that it won’t even give a perception of integrity, if the Minister of Finance can basically do whatever he or she wants,” he added.
“This bill creates a proxy, not a regulator”
Advocata Institute has strongly criticised the bill for vesting sweeping powers in the Minister of Finance, including the authority to appoint the Director General and board members, issue binding directives, and unilaterally make regulations.
“The independence of a regulatory body is nonnegotiable,” Ariyaratne said. “Without it, we risk creating a framework that lacks credibility, is vulnerable to political interference, and cannot deliver on its mandate. In its current form, the Bill does not create a regulator. It creates a proxy.”
The bill requires the Authority to follow the Minister’s instructions and provide any information the Minister requests, raising concerns about whether the Authority can act independently.
Singapore shows a better model
In a detailed analysis using AI, The Sunday Times compared Sri Lanka’s bill with Singapore’s well-established gambling framework. The findings highlight the significant shortcomings of the draft legislation.
While Singapore has a centralised and powerful Gambling Regulatory Authority backed by a series of laws—including the Gambling Control Act and Casino Control Act—Sri Lanka’s bill is described as “a skeletal framework” lacking depth, enforcement muscle, and social safeguards.
“Its primary shortcomings lie in its weak provisions for regulatory independence, its vague suitability criteria for operators, its profound lack of robust and specific harm-minimisation tools like a comprehensive exclusion system, and its technologically outdated enforcement powers against online gambling,” the analysis stated.
“The Bill appears philosophically weighted towards economic promotion and revenue collection, whereas Singapore’s laws, while facilitating a viable industry, are built on the bedrock of stringent control and social protection.”
Missing safeguards for online gambling, tourism and lotteries
Advocata also highlighted several blind spots in the bill. Notably, the draft omits any regulatory oversight for online gambling, a growing sector with significant risks. There is no requirement for registration, monitoring of cross-border operations, or digital harm-mitigation measures.
Additionally, the bill fails to include ex officio representation from the Sri Lanka Tourism Development Authority, despite the close link between gambling and tourism. Experience in the hospitality sector is not even listed as a qualification for board members.
Another major gap is the exemption of the National and Development Lotteries Boards, which Advocata considers a serious oversight, especially given past questions over how state-run lottery funds are managed.
Poor revenue tracking, low penalties
Currently, revenue collection relies on self-reporting by 바카라 operators, which critics say is ineffective. “At present, the Inland Revenue Department (IRD) is responsible for revenue collection, and they go by what is self-reported by 바카라 operators,” Ariyaratne said. “They have no way of tracing these incomes.”
Although the new law repeals previous gaming-related acts, it does not include specific mechanisms for revenue tracking or tax compliance. Ariyaratne warned, “We must have a regulator with the teeth and resources which the IRD has time and again proven it does not have.”
The proposed penalties are also seen as too low to deter major violations. For instance, operating without a licence could attract a fine “not exceeding ten million rupees and/or imprisonment.” In contrast, Singapore imposes penalties up to SGD 500,000 for a first offence, and up to 10% of annual gross gaming revenue for major breaches.
“The Sri Lankan bill’s fixed and relatively low penalties risk being seen by large operators as merely a cost of doing business,” The Sunday Times report observed.
Advocata recommends key fixes
Advocata has proposed several changes to strengthen the bill:
- Appointments to the regulatory board should require Constitutional Council approval.
- The Director General should be hired through a competitive process, as in the private sector.
- Rulemaking power should lie with the Authority itself, modelled on the Securities and Exchange Commission Act.
- Regulations must cover online gambling, include tourism representation, and bring all gambling activities, including lotteries, under oversight.
The . “A law of such national importance must not be the product of closed-door deliberations alone,” it said.
Regional competition and missed opportunities
Advocata warned that while Sri Lanka hesitates, other countries are moving forward. “Countries like the UAE and Thailand—once considered unlikely competitors in gaming—are now moving quickly to open their gambling markets,” it noted. “Without prompt action and regulatory clarity, Sri Lanka risks losing valuable investment and tourism-related revenue to regional rivals.”
Time to rework the bill: experts
While Advocata supports the creation of a regulatory authority, it insists the current draft is flawed and should be withdrawn.
“If we got through the bill in its current format, it is going to be very difficult to change things down the line,” Ariyaratne warned. “We will have a regulator in name that is a proxy for the Minister of Finance.”
In May 2025, the think tank welcomed the Cabinet’s approval of the bill as a positive step. But it now says that good legislation requires public trust, strong safeguards, and real independence.
“The Gambling Regulatory Authority Bill, while timely and necessary, must be reworked to ensure it establishes a truly independent, empowered, and credible institution,” Advocata said.
Now, whether the government will address these concerns before the City of Dreams opens remains to be seen.
