According to historical records, the first formal traditional casinos appeared in Baku during the early 1920s. The casinos offered several gambling opportunities, including various forms of raffle games.
However, the casinos did not last long, as they had been officially closed by 1928. It took several decades before gambling operators could again offer gambling services in Azerbaijan. Two large casinos started operating in the capital in 1991, after the collapse of the USSR. The casinos were very successful, each of them attracting huge audiences.
Within a year, dozens of other casino operators joined the industry, offering raffle games and other forms of gambling. The industry's success resulted in the state legalizing gambling and introducing a tax. The tax was meant to generate revenue for the government and help manage the industry to protect the citizens from gambling harm. The tax rates were set at 70% of the operators' income to ensure maximum effectiveness.
Despite the high tax rates, Azerbaijan's gambling industry continued to thrive. The number of gambling operators increased rapidly, enticing more residents to gamble. The government had to introduce additional measures to improve control and effectively manage the gambling industry. It introduced a law that defined gambling as an entrepreneurial activity requiring operators to obtain licenses for their gambling businesses.
Two large gambling companies were licensed and established in Baku in 1994. One of them was a Turkish-Azerbaijani company that was based in the Grand Hotel Europe Baku, a five-star hotel. In 1997, the gambling industry crisis began in the country following a scandal with the Grand Hotel Europe Baku. The scandal led to the introduction of industry restrictions and later to a complete ban on all gambling activities in Azerbaijan after the amendments to the Civil Code. The ban affected even the state lotteries.
It was until six years later that some forms of gambling were re-introduced, including lotteries, though with strict changes in the rules and regulations. The regulations help ensure that no gambling operations are conducted illegally and that all legal gambling operations are managed effectively. The rules included the monopolization of the industry, allowing only a single state-owned company to provide these services.
Lottery Nowadays in Azerbaijan
Raffle games continue to thrive in Azerbaijan despite the many restrictive regulations. The Azerlotereya Company has done an excellent job at providing raffle games within the boundaries of the law, offering more than ten different raffle games to suit the needs and preferences of all Azerbaijani punters.
The tourism industry has also contributed a lot to the growth of the lotto industry in Azerbaijan. That is because tourists can legally take part in the Azerbaijani raffle games. That helps attract more tourists into the country, resulting in increased income for the government from both the tourism and gambling industries.