Pucón and Puerto Varas Licence Battle
Te future of two casinos in Chile looks uncertain as operators continue to battle in the courts. Two government institutions have requested further information
Te 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.
CHILE LICENSING
Te future of two casinos in Chile looks uncertain as operators continue to battle it out in the courts. Two government institutions have now requested further information for the two licences. Te Tribunal for the Defence of Free Competition (TDLC), has asked the Chilean Gaming Control Board (SJC) for "background information related to the modification of the proposed project Casino del Lago S.A" in Puerto Varas. Meanwhile, the Financial Market Commission (CMF) has asked for access to documents that allow it to determine if Sun Dreams generated a “deadline deadlock” for the Enjoy casino and hotel projects. Te Financial Market Commission is the regulator and supervisor of the Chilean financial market.
Te 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. In 2018 Sun Dreams, filed two appeals before the Santiago Appeals Court against the Chilean Gaming Board (SJC) through which it sought to challenge and revert the decision to grant the licence to the casinos of Pucón and Puerto Varas to Enjoy. Sun Dreams argued 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. Tis, they argue,
allowed the company to put forward greater profit forecasts but went against the rules of the tender and other regulations. Tis is significant as once the technical bid evaluation was completed then the winning bidder was awarded to the company offering the highest financial bid. However in August Enjoy filed a lawsuit before the Tribunal for the Defence of Free Competition (TDLC), against Sun Dreams, for possible acts of unfair competition.
“Fourteen months after that award (…), there is a deep concern that none of these projects, legitimately awarded, and 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 at the time.
“Te 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 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.”
Colombia Government bodies consider lifting restrictions
Te Colombian authorities are moving towards lifting the suspension caused by the COVID- 19 pandemic and reactivating the operation of games of chance throughout the country, although the limitations for reopening haven’t yet been outlined.
Alongside this, operators will be given certain measure to alleviate pressures from operating in the new environment including greater freedom on the importation of used slot machines, provided they are certified.
Decree 576 states: “Operators of games of luck and chance, in coordination with the entities managing the monopoly and the health authorities, shall adopt protocols for the prevention of
spread and spread of COVID-19, for conducting the draws; for the reactivation of the sale of tickets or credits for participation in the points of sale; and for the opening of commercial premises for games of luck and chance, which will be opened according to the capacity of the establishments and the measures of capacity and social distance defined by Coljuegos and the Ministry of Health and Social Protection.”
Te decree continues: “Te opening of commercial facilities must be subject to the capacity of the establishments and the measures of capacity and social distance that, for this purpose, are defined by Coljuegos and the Ministry of Health and Social Protection.”
Argentina
Buenos Aires is considering a one-off income tax of one per cent on banks and gambling operators to help fund action to fight against the coronavirus pandemic.
Te tax would only apply to companies that generated more than $450,000 in gross income in 2019 and would be used to fund sanitary actions and social programs in the Argentinian capital. Te proposal has been put forward by the Frente de Todos political party with Santiago Roberto, Matías Berrotaveña and Manuel Socías highlighting that the health sector in Buenos Aires has received its lowest funding in the last 13 years.
CHILE – Chilean operator Enjoy has called a shareholders' meeting in order to approve a capital increase of US $150 million due to the coronavirus crisis and the negative affect of civil unrest in Chile last year. Enjoy reported that it had approved a calling of a shareholders' meeting for April 24th.
The firm expressed that "these resources will be mainly destined to the financial strengthening of the company and the development of its business plan and future investments."
In addition, the company released its financial statements for the fourth quarter of 2019, which reflected the recent social unrest which began on October 18. As of December 31, 2019 Enjoy presented a loss of $27,707 million, higher than the loss of $ 25,021 million registered in the 2018 fiscal year.
The general manager of the company, Rodrigo Larraín pointed out that “there are many major events that have occurred in the world and in our country in recent times and that have made us operate in a permanent contingency mode. Despite the above, we have implemented profound changes to enhance our value proposition and lay the foundations for the profitable and sustainable development of the company in the long term, given the new context of physical and digital competition, globalisation, and technological development and accelerated evolution of customers and consumers.”
PERU – A claim lodged in a Peruvian court claiming that a new tax on casinos and slots is unconstitutional has been rejected. The claim failed to garner the support of the five votes necessary meaning that the tax will remain in force. Magistrates Marielena Ledesma, Eloy Espinoza and Manuel Miranda ruled on the constitutionality of Legislative Decree 1419, which established a new tax on table games and slot machines in 2019. As a result the demand was considered to be “unfounded”.
The rapporteur of the case, José Luis Sardón, along with Ernesto Blume and Augusto Ferrero, voted in favour of the lawsuit filed by a group of more than seven thousand citizens. Magistrate Carlos Ramos issued a statement that declared the lawsuit against the Selective Consumption Tax (ISC) on casinos and slot machines to be partially founded, although he also recognised the constitutionality of the rule in question.
In the hearing of the Constitutional Court, whose members debated the case files from their homes via the Internet live, the lawsuit was dismissed for not obtaining the five votes required by law.
NEWSWIRE / INTERACTIVE / MARKET DATA P11 SOUTH AMERICA
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