Buenos Aires Land-Based Casinos Given Green Light to Offer Online Gambling

  • Operators will be taxed on gross profit and a percentage of bets, no annual fees
  • The rules require operators to publish information like game rules and odds
  • The original rules only permitted online-only operators
  • Buenos Aires successfully sued in May to stop the application process
The Obelisk in Buenos Aires
Buenos Aires lawmakers have approved an amendment to allow the city’s casinos to apply for online gambling licenses. [Image: Shutterstock.com]

No upfront fees

The Buenos Aires legislature has approved amendments to the city’s online gambling laws, allowing retail casino operators to apply for internet gaming licenses. Brick-and-mortar bingo and slots hall operators are also included in the rework.

Most of the Argentine capital city’s lawmakers did not actually vote in favor of the amendments, but because so many abstained, the “yays” won the day. Of the 58 possible votes, 27 were in favor, 5 were against, and 26 were abstentions.

required to pay 10-20% per bet, plus 6% of their gross profits

Rather than charge a flat licensing fee and then a gaming tax as most jurisdictions in the United States do, Buenos Aires is going with a percentage of revenue structure. Online operators will be required to pay 10-20% per bet, plus 6% of their gross profits, generally calculated as wagers accepted less winnings paid. The upshot of this is that one of the most significant barriers to entry is removed, likely encouraging more competition.

The government anticipates bringing in $6.6m to $9.2m per year from online gambling.

But must be upfront with customers

Included in the changes to the online gambling licensing rules are strict customer safety requirements. Operators are required to provide as much information as possible to customers to allow them to be educated gamblers. Sites must make the rules, odds, and whatever else may benefit the customer readily available and obvious.

Customers must also be able to easily keep track of both their gambling history and funds transfers.

Claudia Neira, a lawmaker and member of the Frente de Todos party, said that while online gambling will bring in much-needed revenue, it doesn’t come without its problems.

when we talk about gambling, we are talking about health”

“’It is logical to want to regulate online gaming as it exists and is installed in the world,” she said. “It is also important that gambling is controlled and prevented. When we talk about gambling, we are talking about health, so we have to face it from that side.”

Additionally, separate from online gambling, a new rule prohibits ATMs, pawn shops, or other sources of quick cash to be located within 200 meters of land-based gambling venue.

Casinos didn’t like original rules

Buenos Aires’ Loteria de la Ciudad (LOTBA) originally published the rules governing online gambling in February of this year. The original plan excluded the city’s brick-and-mortar casinos, allowing an unlimited number of “Online Gaming Agencies” to acquire licenses for virtually any type of internet-based gambling, such as casino games, poker, lottery, and sports betting.

There were also upfront fees involved in the initial set of rules, including a $30,000 application fee and a $100,000 annual licensing fee. Gross revenue was taxed 10% under the February rules.

The retail casinos were not happy with this setup, either because they wanted in on the action, or because they saw online gambling as a threat to their businesses. The COVID-19 pandemic exacerbated the problem and in May, they banded together, filing a lawsuit to stop LOTBA from beginning the application process.

A lower court threw out their case, but a federal court of appeal later not only heard the case, but sided with the casinos.