Chile moving ahead with online gambling bill
During a session of the Senate Finance Committee, Undersecretary of Finance, Heidi Berner, presented an updated bill that aims to regulate the development of online betting platforms. Berner, explained that the new text consists of 75 permanent articles and six transitional provisions. The Senate’s Economy Committee had unanimously approved the draft law (PDL) in general on 02 April, 2024.
The project aims to enhance the role of existing institutions, specifically the Superintendence of Casino Games, by granting it new powers and refining its current responsibilities, thereby transforming it into the “Superintendence of Casinos, Betting, and Games of Chance.”
This updated framework seeks to draw upon the experiences of regulated markets in countries such as the Netherlands, the United Kingdom, Spain, Argentina, and Colombia to create a more effective regulatory environment. Additionally, the proposal includes provisions that prohibit the advertising of online betting houses at events and sports clubs. According to the new bill the SJC will not be permitted to authorize numbers games, lotteries, and bingo online as they will only be operated by the Concepción Lottery and Polla Chilena de Beneficencia.
Polla Chilena de Beneficencia will get a quick start out of the gate as it has a legal license that allows it to immediately start operating sports betting activities without the need for further administrative approvals once the bill is passed. Additionally, both Polla and the Concepción Lottery will be able to broaden their range of activities and apply for general licenses that will permit them to engage in a wider variety of betting and gambling related operations.
Similar to casinos, operating companies must meet a series of formal requirements which have in turn been strengthened by the new bill. Companies formed as closed anonymous societies in Chile must have a specific purpose, minimum capital requirements and a certain number of shareholders, among other conditions. These companies are also required to disclose information about their ultimate beneficiaries, or the individuals who ultimately own or control the company. The SCJ will have the necessary tools and authority to examine this shareholder information.
Before starting operations, online operators will need to obtain a licence from the board, maintain a liquidity reserve, certify their responsible gaming policies, and indicate the bank accounts they will operate with. Rules will also be put in place for the protection of children and adolescents.
The tax rate will stand at 20% on the gross income of online gambling platforms plus a yearly fee. All licensed operators (foreign and domestic) will be subject to income tax and VAT as well. Along with this, operators will need to pay a 1% contribution to responsible gambling. This can be offset by expenses if actions are taken towards this goal.
Those companies which have been present in the market will be subject to a “cooling off” period. They will have to pay a single and substitute tax with two components: 31% of gross income (recognizing untaxed income) and 0.07 UM per user account (recognizing market capture).
