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Update Report on Gaming Legislation in Argentina, Brazil and Peru
Argentina
Argentina as a federal state with 24 autonomous units has a diverse approach to many legal topics, one being gambling, which is regulated under legislation of each individual federal province and the City of Buenos Aires. Thus, there is no unified legal framework for gambling in the whole country of Argentina and each province has its own regulatory authority. All 24 state lotteries are members of the Association of Argentine State Lotteries (ALEA). The latter acts as an industry association and has no regulatory or enforcement competence in connection with gambling.
In line with the applicable provisions of the national Criminal Code, gambling and gaming are prohibited in Argentina, unless expressly permitted. Nonetheless, games of chance are widely accepted and available to the public in a form of land-based casinos, betting places, horse tracks, etc.
In general, the legal framework has been designed for bricks-and-mortar gambling, being later expanded in some jurisdictions to online gambling. Online gambling is not that widespread nor regulated, and this market is rather fragmented and focused on smaller areas of the country. This is also due to the fact that the City of Buenos Aires has regarded as offshore operators both companies overseas, and companies and individuals holding licenses granted by other Argentine jurisdictions.
Furthermore, the licensing system is also fragmented and depends on each individual jurisdiction, and can vary from a simple licensing
regime for the operator only to a more diligent licensing approach including certification laboratories. In Buenos Aires, the online-gambling regulations expressly exclude land-based permit holders from the possibility of applying for an online-gambling agency permit.
When it comes to offshore gambling, it is, in principle, prohibited in Argentina. All jurisdictions that have moved forward in the regulation of online gambling have required operators to establish a local entity and apply for licenses, authorizations or permits through said local entities. The City of Buenos Aires has adopted active measures against offshore gambling operators, seeking to block their activity within that jurisdiction. These measures included administrative and, later on, criminal prosecution, as well as the request of website-blocking orders.
Bearing in mind that IP blocking is in principle not available in the whole territory of Argentina, restrictions related to accepted payment methods have been adopted and have worked so far as a solution to territorial issues related to online gaming.
It remains to be seen what future developments in the field will be, while it is expected that the whole gambling market in Argentina will grow, which will unquestionably lead to a more organized approach.
Brazil
Brazil, the as the largest country in the Latin America, represents an attractive market for each industry. This is why it is quite interesting that basically all gambling activities have been prohibited in Brazil for over 70 years (as of the general ban in the 1940s). In line with the applied ban, the only legal gambling activities are the lotteries under the state monopoly and horse-race wagering. As in many other countries, poker in Brazil is defined as a game of skill and is therefore legal.
Still, there are numerous places in Brazil where people can participate in games of chance, which also led to formation of public opinion that games of chance are used to cover up illegal activities such as money laundering.
The regulatory authority for the whole country is SECAP, which is in charge of regulating lottery activities in Brazil, while the Ministry of Agriculture, Livestock & Food Supply is responsible for the regulation of horse racing.
Changes in the view of the government towards games of chance in general started to shift in the last 10 years, the latest move being legalization of sports betting in 2018. Even more recently, a change occurred when it comes to the organization of lottery games, which was until 2020 entirely in the hands of the state.
Even though the legalization as such occurred for certain games of chance, the same was not followed by the set of express rules to be obeyed when doing so. Thus, there is no licensing regime in Brazil at the moment except with regard to horse betting, which is reserved for non-profit entities legally incorporated in Brazil which are in possession of a racetrack, and which also need to demonstrate the technical and economic viability of the weekly racing schedule and the floor plan of the race field. Such a license is rendered for an unlimited period.
With respect to online gambling and offshore operators, the Brazilian Internet Legal Framework — a law passed in 2014 — technically allows authorities to block and fine operators that collect data or communicate through internet service providers in Brazil, although such operators are currently allowed to provide services to residents of Brazil, subject to the provisions of the Brazilian criminal code.
It is expected that 2022 will be interesting for games of chance in Brazil, since it is anticipated that the competent bodies shall render rules for permitted games of chance (e.g. sports betting). Also, in February 2022, a new draft of the law was presented pursuant to which lawful gambling modalities are not considered a public service like lotteries (sports betting included) but rather a typical economic activity and include casino, bingo, videobingo, ‘jogo do bicho,’ horse-race betting and online gaming. Other betting modalities such as pari-mutuel or direct bets (P2P) remain out of the scope of the bill and thus undefined.
Peru
Games of chance have been legal in Peru since 1979. The respective act encompassed most forms of landbased gambling (including brick-andmortar gambling establishments), casino games, bingo, lotto, betting, slot machines, etc. With respect to online gambling, certain steps were made in the beginning of the 2000s, but this area remained in grey zone until 2022 when the new act was passed, regulating online gambling (and also setting up betting rooms with betting terminals) and taxation of the same (the tax rate has been set at 12 percent of the total tax base and maintenance tax will consist of two percent of an operator’s monthly income).
The new law appoints the Ministry of Foreign Trade & Tourism of Peru (Mincetur) as the country’s official gambling regulator. Mincetur will have the power to monitor all gambling activities in the country, which includes ordering the blocking of URL and IP addresses that infringe upon the law, and ensuring that all technological software and hardware used to provide online gambling is in working order. The first steps of the Mincetur, as emphasized by the legislature, shall be making sure that all current licensed operators will be properly licensed and fully compliant with the legislation.
The new act also prescribes sanctions for noncompliant operators in the form of freezing of the assets or a license disqualification, for up to 10 years or permanently.
