“This was a very special year for the casino industry in Chile”

From what you could perceive from the institution, Which has been the situation of the casino industry during 2010, both from the business and from the players point of view?
This was a very special year for the casino industry in Chile because. Due to the earthquake that affected the Central and Southern area of our country at the end of February, eight of the 15 casinos that comprise the new industry, controlled and regulated by the Superintendence, had to close their doors to the public for periods that fluctuated between the two and four months in average. That’s why during the first semester, the efforts were focused in starting up this industry again, with the same quality standards it had before the earthquake.

Even so, and despite the fact that the totality of casinos restarted their operations in July, during the second semestre we have seen the highest operational results since this new industry started operating, with a sustained growing trend.

During October, for example, the 15 casinos currently operating generated gross gaming incomes (win) of us$ 38,910,000 and received 547,646 visits, which, in average, spent  U$S 71 each. Besides, the 15 local governments and 10 regional governments will receive us$ 6,500,000 in specific gaming tax and the state will collect us$ 2,960,000 in income tax. Operating societies also generated us$ 6,210,000 million in VAT gaming concept.

Considering all the previous facts, I believe the 2010 balance is very positive and reflects that we are in a consolidation phase of the industry. We expect to close this year with, at least, us$ 310 million in gross gaming income, which is a 40% more than last year, and with 4,800,000 visitors.

Which are the main problems that affect the sector? Which would be their potential solutions?
No doubt, I think the proliferation of slots outside casinos is the main problem affecting the industry, because, until a couple of years ago, they were installed in a smaller number, mainly in stores in the neighbourhoods, but today we can observe how a great number of exclusive venues have been opened for this type of games in commercial areas.

It is important to note that games of chance machines just can operate in the interior of casinos and there are discrepancies on if street slots are games of skill or games of chance slots, existing even court rulings in both senses. Slots installed outside casinos do not have any kind of regulation or control. In this context, the government is working in an indication to the bill that seeks to solve the problem of the street slots and that is currently in the Constitutional Commission of the Senate.

How are Chilean casinos positioned with regards to gaming complexes in other Latin American countries?
It is difficult to compare the casino industry in Chile with the Latin American industry, because the model of development defined by the legislador to open the new market is very particular, corresponding to a monopoly geographically decentralized. This is how, legally,the casino instalation is excluded from the Metropolitan Region the maximum number of casinos at a national level is limited to 24. Each region can count with a maximum of three casinos, and when a region doesn’t count with any casino, the law reserves it one of the 24 national places. It also rules the restriction of geographical localization to install casinos, which indicates that every new casino must be located at more than 70 kilometers from the nearest one, no matter the region in which it is located. As a consequence, the casino law does not allow in Chile the develpment of touristic casino resorts, a development model of the industry applied in Las Vegas or Macau.

Within the sector of your competence, Which is the most important legislative and regulatory change registered at a local level and in Latin America during the year?
Considering the existing technological development in games of chance and the growth that the new casino industry has experimented in our country, during 2010 we have dictated norms destinated to promote the development of the industry through the incorporation of new technologies. That’s how we issue a circular that authorizes the use of the WAP (Wide Area Progressive) system in games of chance machines, allowing the interconnection of different casinos of the new industry and the implementation of progessive jackpots in Draw Poker, Caribbean Poker and Go Poker tables in the same casino, so each player may perform an additional bet, voluntarily and independent, that enables to quality for the payment of the accumulated jackpot.

Besides, we have just issued a second circular that authorizes SSGS: Server Supported Game System that enables to download games in games of chance machines directly from a central server. Besides, before the end of the year, we also expect to dictate the norm that regulates the procedure of claims from customers of casinos, establishing two instances: the first one, in which the customer must present his complaint before the casino, and the second one, in which, in case of dissatisfaction with the answer given by the casino, the customer can turn to the SCJ for revision.
At a Latin American level, I would discard the trend that has been observed lately to the formalization of the casino industry, as it has recently occurred in Bolivia, Paraguay and Peru. From my experience as casino regulator in Chile, I think that counting with a regulatory frame and with known and similar for everyone is the base to attract investors, generate competence and promote the healthy development of the activity.

What are your expectations for 2011?
In 2011, I am sure that the Chilean casino industry will continue its growing trend such as it has been observed so far, and my projections are that it will generate gross gaming incomes by us$ 420,000,000, us$ 167,000,000 in total taxes and 6 million visits.