As of today, the online gambling industry in Chile remains unlawful. However, sanctions for such activities are unclear and difficult to enforce, creating a vacuum in the Chilean legal framework. This gap has allowed many online gambling platforms to operate openly, fuelling a market that grows each year.
While a proposed bill aims to address these issues through regulation, it may fall short in tackling the real challenge: the global and elusive nature of offshore operators. True control should focus less on chasing servers and more on regulating the flow of money and the entities that pay and collect.
Given this context, in 2022, former president Sebastián Piñera submitted the an online gambling bill to the Chamber of Deputies. Since then, the bill has moved through the legislative process, with a significant milestone reached in mid-August when the Chilean Senate gave general approval. There were 27 votes in favour, three against and five abstentions. While the draft is not final, this step marks major progress toward comprehensive regulation. Further amendments are expected by 29 September.
The bill’s core objectives are: protecting the population, especially minors; ensuring transparency in financial flows; fostering a competitive market; increasing tax revenue (estimated at around £65m annually); and strengthening oversight to prevent organised crime.
To achieve these goals, the bill introduces a semi-open market structure, requiring operators to obtain authorisation from the competent authority – currently the Superintendence of Casinos, which would be renamed the Superintendence of Casinos, Betting and Gambling, empowered with real-time supervision and enforcement.
Capital controls
Operators must meet strict requirements, including a maximum of five-year, non-transferable licence and establishing an onshore SPV (special purpose vehicle) in Chile, with a minimum capital of 2,000 UTM (Unidad Tributaria Mensual, or monthly tax unit) and a maximum of 10 shareholders. Platforms must implement personal, non-transferable betting accounts for users, who cannot be minors, and are prohibited from granting credit. Operators must monitor user behaviour and maintain records.
The bill also creates a National Responsible Gambling Policy and requires a 2% tax on gross revenue from sports betting, distributed among sports federations, the Chilean Olympic Committee and the Paralympic Committee. Taxation includes a specific tax of 20% on gross revenue (replacing VAT), a 1% contribution to responsible gaming and a ee of 1,000 UTM per licence. The authority will have broad powers to request information, supervise and impose sanctions.
Enforcement measures include enhanced information sharing, website and IP blocking and strict controls over payment methods. Only authorised platforms may advertise, and media must verify advertisers’ legal status. Individuals involved in sports are restricted from betting when they may influence outcomes.
Transitional provisions allow licensing for operators not engaged in illegal activity in the previous 12 months. Those operating illegally must wait 12 months and pay a one-time tax for the 36 months prior to the law’s entry into force (31% of gross revenue and 0.07 UTM per user account).
With these changes, the industry is expected to formalise and grow, ending legal uncertainty for operators, many of which are already active advertising and sponsoring football teams in Chile. The Online Platforms Association, a trade body that includes Betsson, Betano and Coolbet, has welcomed the bill. Nevertheless, some operators may remain clandestine, especially given the requirement to establish a Chilean SPV and the law’s obligations.
Unregulated platforms may operate offshore, making control and enforcement difficult. The stricter the regulation, the greater the incentive to avoid formalisation, although these cases are expected to be rare. It is virtually impossible to pursue international operators that run mobile servers across the globe; real control should focus on the flow of money and on the paying and collecting entities.
María José Reyes is senior associate of Cariola Díez Pérez Cotapos law firm.
Her practice focuses on corporate, commercial, consumer, M&A, venture capital, energy and gaming law. She has advised domestic and international clients on gaming casino licences in Chile.
The post One step closer to online gambling regulation in Chile? first appeared on EGR Intel.
Lawyer María José Reyes weighs up whether the South American country can create a robust regulated market, or if certain offshore operators will remain “clandestine”
The post One step closer to online gambling regulation in Chile? first appeared on EGR Intel.