Chile’s Authorities Prepare to Legalise Online Sports Betting

This update indicates that operators will soon be able to provide their services legally nationwide, but exclusively within the official licensing framework. New rules and measures are set to be introduced under the oversight of a dedicated regulatory authority.

Fast-Tracked Project Review Process

Chile’s government has marked Bill 14838-03 as suma urgencia, the top legislative priority. This status prompted the Senate to review the draft law within 15 days, by May 29th, and expedite the reform. The urgency stems from the project being discussed since 2022, which has led to dissatisfaction and criticism.

The bill seeks to create a legal framework governing digital bookmakers in the state. As of now, existing laws regulate only land-based facilities, leaving online wagering without control.

The Superintendency of Casinos, Betting and Games of Chance will oversee the sphere, replacing the current SCJ authority. The new body will have powers to license companies, supervise their operations, and ensure compliance with regulations.

Expected Requirements for Digital Sportsbooks

The document establishes a compulsory certification framework for the online segment in Chile. To acquire a licence, a business owner is required to register a closed corporation within the state, with operations confined exclusively to web betting services.

The draft law further delineates the following financial commitments:

• a 20% taxation on company GGR;
• payment of VAT at the current rate;
• a 1% contribution of profits to responsible gambling initiatives;
• a 2% allocation of revenues to support national athletic federations;
• a 15% levy on player winnings at the point of withdrawal.

Furthermore, companies will be mandated to disclose their ownership structures, ultimate beneficiaries, and funding sources, as well as comply with AML requirements. The regulatory authority will conduct remote, real-time monitoring of platforms to track transactions and ensure adherence to the rules.

A distinct part of the initiative is focused on customer protection. Specifically, it proposes establishing Chile’s National Self-Exclusion Register, which will enable residents to voluntarily limit their access to betting activities for either 6 months or forever.

Strengthening Efforts to Curb the Illegal Sector

A considerable portion of the bill is dedicated to addressing the issue of uncertified operators. The regulatory authority will ban illicit IP addresses, and Internet service providers will be obliged to cease processing web requests originating from those. Furthermore, fines and other sanctions for operating without proper approval are planned.

Brands that have been active within the Chilean market without authorisation for 12 months prior to the law’s enactment will not qualify for the standard certification process. Instead, they will be subjected to a 1-year cooling-off period and required to pay a 1-time substitute tax amounting to 31% of the GGR earned over the preceding 36 months. Additional sanctions, including bans, penalties, and even potential imprisonment, are also under consideration.

The authors of this urgently revised legislative initiative have emphasised that its effectiveness will significantly hinge on restricting the financial transactions of unlicensed websites. An additional requirement is intensified cooperation with LatAm payment organisations to thwart illegal schemes.