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Chile – Chile’s Senate Committee approves regulation of slots outside of casinos

By - 22 August 2018

The Senate Interior Government Committee has unanimously approved a bill that regulates the use of machines for fun and recreation, which are located outside of the 18 casinos authorised by Law No. 19.995 and the seven Municipal Casinos.

The initiative aims to regulate the activity by clarifying the legal status of establishments that house slots on their premises and establishes a system that authorises their operation whereby they meet international standards. It will also allow the government to monitor their financial transactions online.

The President of The Association of Operators, Manufacturers and Importers of Electronic Entertainment (FIDEN) an interest group for the SWP (Skill with Prizes) industry Sebastián Salazar hailed the decision as a “milestone” as it did away with an alternative initiative that sought to prohibit their activity altogether.

In May, The Senate’s advisory Commission for Decentralisation and Regional Development unanimously approved a bill that sought to prohibit the operation of slots or games of chance outside of premises legally allowed to offer gaming. Alejandro Navarro, parliamentary forerunner of the project, said that the bill “seeks to gradually prohibit the operation of slot machines or gambling outside the premises that are permitted by the law of casinos No. 19.995, while supporting the owners of these stores with restructuring programs ” Laws had to be changed as a matter of urgency as “legislation, nowadays, is absolutely obsolete, it is limited only to what happens inside casinos, to the gaming room, and not outside,” he said.
However, Salazar said that the latest decision meant that the government had finally recognised the value of these establishments because of the number of jobs they provided.

“We have been asking (the government) for 15 years to regulate our activity, allow the development of this sector, and protect the rights of customers, workers, community authorities and others.”

Gaming outside of casinos is widespread and the government has struggled for years to deal with the problem. In 2016 The Chilean Gaming Board (SJC) released the results of its first ever survey into gaming machines operating outside of casinos. The wide-ranging study, which was carried out on behalf of the SJC by the Faculty of Architecture, Design and Urban Studies at the Pontifical Catholic University of Chile, revealed that there are more than 33 thousand machines operating illegally in Chile. As part of the study the researchers visited more than 3,000 businesses which have been granted a municipal licence to run gaming arcades and found that 1,327 of them housed machines that handed out cash prizes – something which is in direct contravention of Chile’s gaming laws, as according to federal law, slot machines may only be present in casinos.

The rise of illegal slot parlours is down to local municipalities as local governments have allowed amusement arcades to operate in their jurisdictions but have not drawn a clear line between machines that award prizes and that have an element of skill involved (skill with prizes machines) and slot machines. Subsequently, a great many slot parlors house both with revenue increasingly deriving from the latter. The study identified a number of different categories of game which fell into this type. These included a wide variation of video poker, lotteries and bingo as well as coin pusher games.

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