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Chile – Supreme Court decision paves way for tender

By - 6 June 2017

Chile’s Supreme Court has rejected the appeals put forward by casino operators, Marina del Sol, Inversiones del Sur and Enjoy who claim that the new licensing process for the municipal casinos is in contravention of their constitutional rights.

The Supreme Court unanimously rejected the six writs of amparo – a remedy for the protection of their constitutional rights put forward by operators. As a result the bidding process could soon be underway for the municipal casino licences. According to a statement released by the board “once the enforcement is dictated, the process of granting operating permits for gaming casinos will be restarted.”

In October 2016 the SJC announced that it had decided to postpone the hearing for the submission of tenders for the bidding for the municipal casino licences which had been scheduled to take place on November 4th. Investors had pointed out a number of shortcomings as well as a lack of information when it came to the process initiated by the SJC via the Santiago Appeals Court. They also warned that the demands put on operators applying for the casino licences were excessive and would make the businesses unprofitable. According to the statement released by the SJC at the time all seven of the municipal casino licences would be put on hold and would resume once the court had made its decision. The Appeals Court initially ruled in the favour of the operators but the SJC appealed the decision via the State Defence Council and it was referred to the Supreme Court.

However, a number of questions surrounding the process still remain especially when it comes to a circular which was published by the SJC in February this year which in effect extends the municipal licences. The circular rules that 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. There are also a number of questions surrounding the deadline for the newly reactivated tender process.

The process of granting new licences have suffered a number of delays and setbacks but the court’s decision will undoubtedly be a major step in getting the licencing process finally back on track. According to estimates released by the SJC, the new tender process could help raise tax income generated for the state by the new casinos by as much as 46 per cent on average while gross gaming income (which will be divided equally between the municipality and the state where the casino is located) will increase by 20 per cent. This will herald in a number of new large scale casinos especially as a number of the municipal casino licenses, such as the licence for Vina del Mar, are located in the most popular local tourists destinations.

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