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Puerto Rico legislature passes sports betting bill


A bill to regulate sports betting in Puerto Rico is headed to Governor Ricardo Rosselló Nevares to be signed into law after passing the unincorporated US territory’s legislature. 

Rosselló, who has previously claimed the legislation could turn Puerto Rico into a “state-of-the-art jurisdiction” for sports betting, is likely to ratify the bill. 

The bill was passed by a conference committee formed of members from the Puerto Rico House and Senate, to reach a consensus on differences between the bills passed by each chamber. These differences largely centred around social responsibility concerns, such as a requirement that no point of sale can be located within 100m of a school, rehabilitation centre or religious venue.

PC2038 establishes the Gambling Commission, a body created through the legislation, which will be led by a seven-strong board of directors, and a commissioner appointed for a ten-year term. This body will replace the existing regulatory bodies, the horse racing regulator Administración de la Industria del Deporte Hípico and the Division of Gaming.

It sets out a 7% tax on gross gaming revenue from land-based betting, and a 12% tax for online operations, higher than the originally proposed rate of 6% of land-based GGR and 11.5% for online. The license fee is yet to be determined, though the bill sets out a minimum fee of $50,000 for larger operators, which reduces to a minimum of $2,500 for smaller operators. 

Betting will be permitted at casinos, racecourses, off-track betting facilities and online, as well as at facilities that previously hosted cockfighting, which will be allowed to secure a licence without a fee attached. This is designed to mitigate the federal ban on cockfighting that passed Congress in December 2018.

Taxes raised through sports betting regulation will be split between a number of different bodies, with the largest share (50%) going to the territory’s pension fund. The police force will receive 10%, with the same percentage going to the Health Insurance Administration, Department of Recreation and Sports, and Department of Education. The final 5% will be allocated to the treatment of gambling addiction.

Puerto Rico could earn up to $87m per year from legal sports betting, according to a pair of studies commissioned by its Chamber of Commerce. The first, conducted by The Innovation Group, estimated that revenue in its 2020 financial year would come in at $29m, which it said would rise to $51m in 2021, $68m in 2022, $77m in 2023 then $87m in 2024.

Spectrum Gaming Group, meanwhile, estimates that revenue from legal wagering will come in between $44m and $62m per year.