August witnessed Uruguay’s online gambling bill take one leap towards becoming law after being approved by the country’s senate.
Voted in favour for its implementation by Uruguay’s Chamber of Senators, the bill will now be sent to the region’s House of Representatives for further consideration.
If the bill is passed, it would allow the General Directorate of Casinos of the Ministry of Economy and Fiance to regulate online gambling in Uruguay. In order to monitor all online gambling providers in the country, a region-wide register would be utilised.
Delving into Uruguay’s potential new regulations, Juan Ignacio Juanena, Interactive Business Manager at Enjoy Uruguay, revealed that the potential of the Uruguayan market, at its highest level, is estimated at around $52m in gross gaming revenue.
Moreover, he highlighted that casinos that currently hold land-based licences will be able to obtain an online permit
He noted: “The law establishes that the executive branch, through the General Directorate of Casinos, can launch online casino operations (poker, roulette, slots and more), either directly through the traditional system or through current operations that work through the so-called mixed-system.
“Thus, the General Directorate of Casinos can authorise land-based casino games licensees (or even the ones who have a permit to operate in the future) to operate online.
“The project that is still pending the approval of the Chamber of Deputies is a new commercial way for land-based operators that already have physical operations in Uruguay and doesn’t allow other companies to obtain a licence to only operate online.
“The land-based operation is an essential requirement to obtain an online gaming licence and is even conditional to its existence.”
“Online gambling is one more marketing tool that complements the entertainment offering of land-based operators”
Since the last quarter of 2021, Uruguay has moved forward with the regulation of the market due to a project drafted by the Ministry of Economy.
If approved by the Senate, the National Directorate of Casinos would be in charge of redirecting five per cent of its gross profits to financing problem gambling programmes.
Looking at what the Uruguayan casino operator expects to witness in the country’s online vertical, Juanena stressed that online gambling is “almost a crucial commercial need” for physical operators in the country to modernise the entertainment offering and to be able to adapt it to new technologies and new generations.
“Online gambling has existed for over a decade in countries in Europe and the United States,” Juanena added. “Even in Latin America, some countries have regulated the activity many years ago.
“Online gambling is one more marketing tool that complements the entertainment offering of land-based operators. There are international studies that have analysed the impact of the online gambling regulation in physical casinos and the results have been very positive for all parties involved.
“In Atlantic City, in New Jersey, the activity was regulated in 2013, and land-based casinos received an online licence to either operate independently or with a partner. The results of these operations reflected the importance that online gambling would have in other countries.
“Around 80 per cent of the casino online players were new players, not land-based players or customers that no longer attended casinos physically. The other 20 per cent were players that were active customers of land-based casinos.
“The percentage of customers who are going to share the online and land-based spaces is relatively low, but even within this segment, the statistics show that the value of the omnichannel customer, the one who likes both verticals, ends up increasing.”
“Limiting online gambling licences to local operators is a good way to protect Uruguayans”
Predicting when the regulation itself would be implemented, Juanena believes that it may take “a few months” but hoped the bill would be in place during the first quarter of 2023.
Tackling the question of if there should be a greater focus on responsible gambling, both within Uruguay and the Latin American market, Enjoy’s Interactive Business Manager expressed his opinion that the country has treated the regulations project “responsibly” via the participation of all politicians and private sectors, as well as varying organisations involved in the industry.
He commented: “This project takes into account many things included in other countries’ regulations, their experiences and it also adapts to the local reality in Uruguay, which is a smaller, reduced market, where the jobs and the investment of current operators must be protected.
“Limiting online gambling licences to local operators is a good way to protect Uruguayans, both employees and customers, who will be able to access local support, physical offices, and will have the support of the different operators, which always guarantee greater transparency for the client.”
Furthermore, Juanena emphasised that regulation will be a “key point” in the project, stressing that “many issues” in the market depend on it. However, he did state that the models being taken as a reference to online gambling in Uruguay to produce a competitive framework with a “guarantee for all” in taking care of both employees and players.
“Free competition between land-based operators, the use of certified independent platforms, the selection of providers that have local permission, the payment methods and responsible gambling policies are key aspects of the regulation and it’s been clear in the discussion of the project,” Juanena added.
“It would be really important for the country to set in the regulation that everyone in the country is allowed to play, regardless of their nationality, considering that today we have a strong tendency of welcoming foreigners in our country, who add to the millions of tourists who enter Uruguay every year.
“…making progress on this is already a big step for the land-based operators”
“This audience can generate significant revenue for both operators and the government through taxes. Currently, there’s tools that easily verify the location of a person in order to enable access to the game only within the country.”
As part of the proposed regulations, casino games will remain under the orbit of the General Directorate of Casino, while other verticals would be under the control of the National Directorate of Lotteries and Quinielas.
Looking into the benefits of such a structure, Juanena explained that the proposed framework respects the current operation and distribution of games of chance in Uruguay.
He commented: “Without a doubt, we would have liked this project to allow operators authorised by the General Directorate of Casinos to also operate sports betting, as is the case in the rest of the Latin American countries where the operation of this vertical is open to operators, favouring free competition between the operators and forcing each operator to have a better product, on par with the main sports betting operators at a global level and with competitive odds, but unfortunately this project doesn’t consider that possibility.
“It is now important to move forward with this project, and making progress on this is already a big step for the land-based operators. Without a doubt, in the future, Uruguay will have to analyse whether or not to have a single sports betting operator.”
Revealing what enticed the government to regulate the Uruguay online gambling space, Juanena stated that in countries that have been developing online gambling, revenue from the aforementioned sector – including sports betting – can, in some cases, reach 50 per cent of the volume of games of chance.
“In Latin America, Colombia, Argentina and Peru have approved online gambling, and in the rest of the countries it is under discussion,” it was concluded.
“I believe that it is an obligation as a country to regulate an activity that is a reality in the world and that allows physical operators to modernise and offer their clients and non-clients a new entertainment proposal according to the new reality.
“Sustained growth above 12 per cent per year for more than 10 years reflects the potential of the industry and the interest of customers around the world in this activity.”