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Puerto Rico launches consultation on sports betting regulations


Puerto Rico has taken a step towards launching legal sports betting over a year after legalizing the vertical, beginning a 30-day consultation on sports betting regulations developed in partnership with Gaming Laboratories International (GLI).

The unincorporated US territory’s then-governor Rico Rosselló Nevares ratified legislation in July last year, shortly before he resigned amid a scandal over comments he made on messaging application Telegram to members of his staff.

This year has already seen significant changes to the potential regulatory framework for gambling. Jaime Alex Irizarry, gambling director of Puerto Rico’s Tourism Board, resigned in April, before new governor Wanda Vázquez Garced appointed José Balasquide-Córdova and Cristóbal Méndez to oversee the formation of a new, dedicated gambling authority. 

GLI was then hired to consult on the development of the sports betting regulations in May. 

The regulations developed with input from GLI include the 7% gross gaming revenue tax on land-based betting, and 12% rate for online wagering. Fantasy contest operators, meanwhile, will be subject to a tax equal to 12% of contest entry fees.

In terms of where betting can be offered, betting and fantasy contests may be carried out in casinos, hotels without casinos, inns, racetracks, horse betting agencies, shops, and any other venue the Puerto Rico Gaming Commission sees as viable and secure. Online and mobile betting does not appear to have a land-based tethering requirement. 

As well as offering betting on any professional or college sport, players will also be permitted to wager on esports, covering real-time strategy, fighting, first person shooter or electronic sports games. 

They also confirm a $50,000 fee for a principal operator license, with internet wagering platform operators playing the same amount. For retail betting outlets, such as off track betting facilities or other points of sale, a $2,500 fee will be levied. 

Fantasy sports license fees depend on the size of the business. For those generating annual gross income of $10m or more, a $10,000 fee will apply. This drops to $1,000 for any business generating less. 

Casinos and racetracks will have to apply for sports betting and fantasy licenses, though to support the country’s rooster industry – cockfighting – these entities will not be subject to license fees for the first ten years of operation. Racetracks, meanwhile, will have license fees cut by 50% for the same period. 

Service providers will also be required to secure a license, with manufacturers, providers, testing laboratories and distribution service providers to pay $5,000. This falls to $2,000 for indirect services such as consultants, restaurants and cleaning companies.

Betting will be restricted to those aged 18 and over, while operators will be required to submit a responsible gambling strategy. This must nominate employees responsible for the implementation and maintenance of the plan, as well as a comprehensive training plan for staff. 

Licensees must also highlight the potential risks associated with excessive gambling and the availability of treatment to players. Sites and locations must display the 18+ age limit, and a message stating that gambling can lead to addiction, alongside a number to the country’s problem gambling helpline. 

The Puerto Rico Gaming Commission will also operate a national self-exclusion register, for both online and retail customers. 

In addition, advertising must be socially responsible, with no false or misleading information, and must not appeal to those aged 18 and under. This means it may not feature cartoon characters, or fictional characters of particular appeal to minors.

Operators will also be required to develop and implement an integrity monitoring system, using software to detect unusual odds movements, unusual spikes in bets. All suspicious information must be reported to the Commission within 24 hours of it being identified. 

The Puerto Rico Gaming Commission is now accepting written comments on the regulations for 30 days, having launched the consultation on 10 August.

In terms of what revenue the country’s government can expect from legal wagering, Innovation Group has suggested it could generate up to $68m by 2022. Spectrum Gaming Group, on the other hand, projects annual revenue of between $44m and $62m.