News

/ New bill on online gambling platforms

21 March, 2022

On March 7, 2022, the Executive Branch submitted to the Congress a bill that Regulates the Development of Online Gambling Platforms (Bill 14838-03). In view of the growth and visibility of this activity, it has become necessary to regulate its operation and some of its effects. Thus, its content seeks to establish a special statute for this type of platforms, which would be added to the existing one for gaming casinos and other authorized gambling.

 

Felipe von Unger V.
Associate Attorney
Alessandri Abogados

 

Some general elements of the project that worth highlighting are:

· That it adopts the project in considering that platforms that “regardless of the place where the infrastructure that supports their operation is located (…) allow one or more users to place bets from the national territory” operate in Chile. This is a criterion that takes into account the reality of these new “delocalized” business models, thus forcing them to have a local legal and economic existence for the purpose of complying with legal obligations of different nature, and also to make possible their control and the prosecution of eventual liabilities;

· That it covers the operation of all the platforms that allow online betting from the national territory, understood as the act by virtue of which a person risks an amount of money on events whose future results are unknown, with the expectation of obtaining a prize depending on that result;

· That, following the Colombian example, it intends to establish a system of licenses – general and special – that the authority may grant subject to compliance with certain requirements. Among these are that the operator of the platform must be incorporated in Chile as a closely-held corporation with this as sole purpose, pay the fees associated with each type of license, provide surety to guarantee compliance with its obligations to its users, and that the betting platform complies with the applicable technical standards;

· That the Superintendence of Gaming Casinos (which would be renamed “Superintendence of Casino, Betting and Gambling Games”) is in charge of processing the corresponding operating licenses, supervising the operation of the operators of betting platforms and sanctioning those who operate them without complying with the applicable regulations and the duly granted license;

· That it empowers the Superintendency to require, as an injunction, that the Internet service providers block access to the questioned platforms, that the operators of the means of payment interrupt transactions with it or that the different media suspend all advertising of the questioned platform. All this, with prior court ruling.

Also, from the reading of the text proposed by the Executive branch it seems to us that there are matters that should be reviewed or that will be subject to discussion, given its wording and nature. Among these appear to us to be:

1. The payment of 2% of their annual gross income obtained by the operators of the platforms to the corresponding sports federation (or Olympic Committee or Paralympic Committee of Chile, as the case may be) when the game involves a betting subject that falls on a national or international sports competition;

2. The obligation of betting platform operators to allocate, through non-profit institutions, 1% of their gross revenues to actions aimed at promoting the responsible development of online gambling;

We believe that both obligations summarized in numbers 1 and 2 above are somewhat debatable in that i) they are pecuniary obligations in addition to the payment of taxes and fees associated with the license; and ii) they do not admit alternative ways of complying with their stated purposes.

3. The lack of distinction (according to their term of duration or other criteria) in the amount to be paid by operators for special licenses;

4. The effect in Chile, and its qualification by the authority, of the sanctions received abroad in view of an eventual revocation of the license or inability to hold one;

5. The somewhat broad wording of the provisions establishing advertising restrictions;

6. The cybersecurity standards that must be observed and the need for pecuniary damage to users to configure the grounds for revocation associated with non-compliance