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Chile – Chile Court suspends four casino Tender Processes

By - 28 October 2016

The Santiago Appeals Court has declared admissible an action brought against the Chilean Gaming Control Board (SJC) over the granting of the municipal licences by Marina del Sol.

The company has accused the board of inconsistencies during the licensing process over the municipal casinos in Iquique, Coquimbo, Viña del Mar and Puerto Varas. The remaining casino licences in Arica, Pucón and Puerto Natales will still go ahead as planned.
Marina del Sol has pointed out a number of shortcomings as well as a lack of information when it comes to the tender process initiated by the SJC and warned that the demands put on operators applying for the casino licences are excessive and would make the businesses unprofitable.

The court’s decision means that the licensing process for these four casinos could be paralysed. According to the schedule as put forward by the SJC, offers were to be received next month and the court’s decision could have potentially dire repercussions on the industry as the licences for the municipal casinos expire at the end of next year.

The SJC, however, said that while it had accepted certain aspects of the court’s decision it would continue towards the granting of the licences on schedule and that the decision did not mean that the licences had been suspended.

However Mario Rojas, a lawyer and director of Marina del Sol, stressed that the court’s decision was clear and meant that the licence process for the casinos in Iquique, Coquimbo, Viña del Mar and Puerto Varas had indeed been suspended.

Crucially, the court ruling affects the largest municipal casinos in terms of gross gaming revenues. The SJC reported earlier this month that in August the casinos which operate in Viña del Mar, Arica, Iquique, Puerto Varas, Coquimbo, Pucon and Puerto Natales recorded gross gaming income (win) of US$16,524.779. The revenues generated by the municipal casinos made up 29.2 per cent of the total which was generated by the casino industry in that month.

As forecast the battle between Chilean operators and the Chilean Gaming Control Board (SJC) has worsened over the new tender process for the licences. In August it was revealed that Enjoy and Marina del Sol had both resorted to the courts in order to challenge certain aspects of the new licensing process. According to local press reports, Chilean courts have now received a number of appeals on the grounds of unconstitutionality filed by local operators which combined could grind the licensing process to a halt.

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