Operator News

Chile – Enjoy files lawsuit against Sun Dreams over casino delays

By Phil - 18 August 2019

Enjoy has filed a lawsuit before the Tribunal for the Defence of Free Competition (TDLC), against its competitor Sun Dreams, for possible acts of unfair competition.

The conflict arose after Enjoy was awarded the 15-year license for the Pucón and Puerto Varas casinos once the tender for the municipal casinos was completed.

“Fourteen months after that award there is a deep concern that none of these projects, legitimately awarded, has been able to begin construction. And this is not due to causes attributable to our representatives,” said the company in the document put forward to the TDLC.

“The delay is due to the fact that Sun Dreams, a competitor of Enjoy, has developed an organised, repeated and systematic accumulation of judicial, administrative and de facto actions, aimed at taking away from the company the permits that were legitimately granted and, alternatively, to increase the legal and business uncertainty that affects it and its costs, until its operation becomes unfeasible,” the complaint says. “And Sun Dreams has acted in the conviction that the delay in the construction of Enjoy’s projects, in which it is committed, will be enough to drive it out from the market.”
Chile’s casino laws establish a maximum term of two years for operations to begin once the permit has been granted. In this regard, Enjoy says that, although this period is extendable for up to 12 months, regulations do not provide for a possible suspension or postponement by the licensing authority in case of judicial or administrative actions against the awarding of the licence.

As such Enjoy is “the victim of the results of a strategic act,” the company said. Enjoy has asked the TDLC to give Sun Dreams a fine worth around US$12.5m.

In 2018 Sun Dreams, filed two appeals before the Santiago Appeals Court against the Chilean Gaming Board (SJC) through which it seeks to challenge and revert the decision to grant the licence to the casinos of Pucón and Puerto Varas to Enjoy. Sun Dreams argue that the resolutions of the SCJ are illegal.

According to the company, Enjoy presented two projects with incorrect technical criteria, which allowed the company to reduce the costs associated with both projects. This, they argue, allowed the company to put forward greater profit forecasts but went against the rules of the tender and other regulations. This is significant as once the technical bid evaluation was completed then the winning bidder was awarded to the company offering the highest financial bid.

Caption: The casino in Puerto Varas