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Chile – Chile President to extend municipal licences

By - 9 January 2015

After many months of debate, it is expected that the President of Chile, Michelle Bachelet could finally sign legislation which will extend the municipal casino licences for a further two years.

The new law would affect the seven casinos operating within the governing municipalities of: Arica, Iquique, Coquimbo, Viña del Mar, Pucon, Puerto Varas and Puerto Natales.

According to parliamentary sources, the new legislation could be presented to Congress later this week. On Tuesday members of the Chilean Gaming Control Board (SCJ) met with the Secretary of Treasury, Alejandro Micco, and the Minister General Secretariat of the Presidency, Ximena Rincón, in order to clarify the final details of the new bill. The issue is a vital one for the municipalities where they are located as they provide a significant share of funding locally. In the case of Viña del Mar, for example, the casino provides 50 per cent of the municipal budget.

The new bill would extend municipal licenses for a further two years until the end of 2017 in order to give the municipalities time to prepare for the new bidding process and find alternative ways to raise funding once the casinos fall in line with the other casinos in the country and come under supervision of the SJC. In that period the casinos will continue to pay the same amount of its annual income to the municipalities where they are located.

Meanwhile, new details have emerged as to the licensing process once the municipal licenses expire. According to the Mayor of Pucon, Carlos Barra the new law would state that casinos will remain in the cities where they are located and significant resources will be guaranteed to the city.

Similar statements were also made by the Mayor of Viña del Mar and President of the Association of Municipalities of Casinos Games, Virginia Reginato who has been spearheading the campaign to allow for an extension of the municipal licences.

“This vital problem will be resolved soon and we shall soon know the final contents of the project that President Bachelet sends to Congress. We are certain and have total confidence that the President will keep to his word and addressees this enormous danger that now lurks in these seven districts,” she said.

The issue of the municipal casinos has become increasingly urgent of late with local lawmakers concerned that they will soon lose out on millions of dollars of tax revenue from casinos located within their jurisdictions.

In 2005 Chile passed a gaming law which allowed for the construction of 18 additional casinos to the seven municipal casinos already in operation. The licence for the seven other casinos in Chile ends on 31 December 2015. The casinos which were already licensed before the new act come under the supervision of the local municipalities where they are located and are a vital source of funding.

However there are no guarantees that Congress will agree to the extension. In March Chilean lawmakers rejected plans to extend the municipal casino licences on the grounds that it was unfair.

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