Chile’s Senate Economy Committee has voted in favour of proposals that would effectively prohibit private online gambling operators, dealing a significant setback to the government’s plans to establish a regulated iGaming market.
The decision was taken on 9 November, when senators approved two amendments by three votes to one, with one abstention. The proposals will now be combined into a single text at the committee’s next meeting, expected to take place the following week.
The legislation must subsequently pass through the Senate Finance Committee before returning to the full Senate for consideration.
The vote has triggered strong criticism from industry representatives, who argue that a complete prohibition would undermine consumer protection and encourage players to use unlicensed gambling websites.
Industry Association Warns Against Prohibition
The Agrupación de iGaming Responsable (AGR), a trade association representing the responsible iGaming sector, condemned the committee’s decision in a statement issued on 10 November.
The organisation described the amendments as a potential constitutional violation and argued that banning private operators would not eliminate online gambling activity.
Instead, AGR warned that consumers could migrate to illegal platforms operating without the safeguards provided by a regulated market. It also claimed that the proposed restrictions would eliminate competition and create a monopoly.
The association further criticised the committee for proceeding despite warnings from its own secretary that the amendments could be inadmissible under Senate rules.
Government’s Regulatory Framework Pushed Aside
The decision represents a major obstacle for President José Antonio Kast’s administration, which has been working to establish a formal legal framework for online gambling.
In October, the government introduced amendments to a bill originally presented in 2022. Its proposed regulatory model included five-year operating licences, advertising restrictions, new tax requirements and additional player protection measures.
However, the two competing prohibition proposals have now taken priority, effectively sidelining the government’s regulatory amendments before they could be debated.
Deputy Finance Minister Sebastián Vallebona expressed disappointment, explaining that the administration had spent three months developing its proposals alongside parliamentary advisers.
Regulation offers a more effective way to protect families, prevent underage gambling and address gambling addiction.
Sebastián Vallebona, Deputy Finance Minister
Two Proposals Seek to Restrict Private Operators
The first amendment, submitted by senators Diego Ibáñez and Gastón Saavedra, would completely prohibit private companies from providing online gambling services in Chile.
The second, introduced by Senate President Paulina Núñez, would reserve the online gambling market for two state-linked organisations: Polla Chilena de Beneficencia and Lotería de Concepción.
The developments add further uncertainty to an already complicated market. Since July, dozens of operators have registered and paid VAT in Chile, despite an earlier Supreme Court ruling that prohibited online betting and ordered unlicensed websites to be blocked.
The next committee discussions will determine how the two proposals are combined before the bill advances through the remaining legislative stages.
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