Legislation
Paraguay – Casino licence restricts competition says Head of Gaming Board
By William - 28 November 2019
Controversy is surrounding the new mega complex planned for San Francisco Island in Paraguay with the head of the gaming board saying that the licence was granted for too long and restricts competition.
In November 2017, the then head of the National Gambling Commission of Paraguay (CONAJZAR) Javier Balbuena, signed a contract for the operation of a casino with company Vimérica SA for a casino located on the island of San Francisco – an ecological reserve. Before the contract then President Horacio Cartes and the Minister of Finance, Lea Giménez, endorsed Decree 9670/17, whereby the State granted Vimérica SA the operation of a casino with an investment valued at US$148 million. Clause 27.2 clears the way of any competition as the terms and conditions state that “for future tenders that the proposed minimum investment be equal to the amount of the new casino with the exception of the department of Alto Paraná.”
However the head of the CONAJZAR José Ortiz Baez said that it was overly restrictive: “We have not charged anything yet and for at least 30 years we will not be able to tender a casino taking the four years of execution of the project into account and the 25 years exploitation rights established in the contract.” Prior casino licences have required investments of just over US$5m.
Construction of a new mega resort and casino began in June with the hydraulic filling on San Francisco Island, where the company in charge of the project plans to establish a tourist and entertainment mega complex that will feature a casino and luxury hotel. The investment envisaged for the new complex stands at around US$150m and includes the construction of a five-star hotel, including a convention centre for 2,000 people, restaurants, a casino, luxury shops and an amusement park.
American company Vimerica Development LLC is investing in the project via its subsidiary Vimerica SA along with local and foreign investors. Along with its local partner, the company will invest in the integrated resort with Paul Steelman, majority shareholder and CEO of Las Vegas, Nevada-based Steelman Partners.
In September it was revealed that construction had been temporarily suspended due to a dispute with local fishermen. 350 fishermen in the area are demanding up to US$1,500,000 each in compensation because of the work being carried out on the banks of the Paraguay River.
