Israeli Law’s definition for “Gambling” does not include “Prize”

It’s a known fact that online gambling is illegal in Israel. However, it’s a much lesser known fact that the Israeli law’s definition for “gambling” is much wider than in many other jurisdictions.

In short, participants don’t have to pay anything for their right to participate in the activity for it to be considered as gambling.

This means that a social gaming site which is completely free to play might be considered illegal gambling if participants can gain anything of value (a “prize”) if they win.

The “prize” does not have to be money and, for example, virtual tokens which can be used to purchase goods on other platforms might also be considered a “prize”.

One implication of the above is that companies which activity is not considered gambling in many jurisdictions, might still be illegal in Israel.

Therefore, companies should carefully examine (and possibly change) their business model before targeting Israeli citizens with what would customarily be considered as “social gaming”.

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