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Chile – Marina Del Sol concerned over municipal licence extension

By - 24 February 2017

Delays over the granting of the municipal casino licences are causing consternation after the Chilean Gaming Control Board (SJC) published a circular which in effect extends their licences.

After a special meeting Marina Del Sol issued a statement it which it argues that operators already established in the municipal casinos have been handed an unfair advantage by the SJC: “Due to the search for a solution that would allow for the municipal casinos to be located in the same communes as they operate in today Law 20.856 of 2015, was created, which was also intended to establish a clear framework to adapt them to the regulations. This should have taken place between 2013 and 2014 and was extended for two years which implies a special benefit only for the operators of these businesses. This benefit gave them concrete and measurable benefits of millions of dollars,” the company said.

“But the new law, at least, established fixed chronological limits, both to the rules that allow the operation of the companies operating municipal casinos and to the respective concessions, in terms such as their regime can in no way go beyond December 31, 2017.”

The company also criticised the ex head of the SJC Daniel García Fernándes. “The former Superintendent, on the last day that he carried out his duties, issued Circular 84, which in practice extends indefinitely and abnormally the duration of these businesses, which are not subject to a competitive, informed and transparent regime. This extension produces, for the favoured stakeholders, net incomes that could reach many tens of millions of dollars.”

In a strongly worded statement the company described the new licensing process as “ad hoc” and “torturous.” The company has asked Chile’s securities and insurance regulator (SVS) to look into the matter due to what it describes as anomalies in the value of the oldest municipal licence holder that day and called upon the new head of the SJC Vivien Villagrán to examine “with speed and seriousness the situation which has been created.”

Last week the SJC issued Circular Number 84 which confirms that the municipal casinos in the communes of Arica, Iquique, Coquimbo, Viña Del Mar, Pucón, Puerto Varas and Natales will remain open until the new operators are ready to take over.

According to a statement released by the Board: “Law No. 19,995 guarantees the continuity of the seven municipal casinos for a total of three periods of fifteen years each, and sets out the procedure for granting operating permits for the specified cases and refers to the transition of the current concessions, it authorises the continuity of the operation of these until a new operator – adjudicated under the procedure indicated by the law – is in a position to operate.”

The circular ratifies Law No. 19,995 (Chile’s casino law) when it comes to the extension of the municipal licences. The seven municipal licences will remain in effect until the SJC issues a certificate attesting to the fact that the new casinos comply with a number of strict legal and regulatory obligations.

While the circular states that Law Number 19.995 sets a deadline for 31 December 2017 for the municipal governments and the current licence holders to agree on new contracts and extensions, the law according to the SJC, does not actually set December 2017 as the deadline for the new casinos to be operational.

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