Spain: the draft decrees on slots and exchange betting are published

The publication also confirms that the Spanish regulator will be re-opening the market for new entrants, which in the near future are going to be entitled to apply for the licenses allowing them to start operating in Spain.

The publication of these two draft regulations constitutes the first step in the official procedure to be followed and that should lead to the final approval of these new regulations in the next three or four months. Note in this respect that the Spanish authorities will very likely notify to the European Commission these draft regulations -in the context of the procedure deriving from Directive 98/34-, something that will extend the process of approval of these decrees by at least three months. In any case, since both procedures should be running in parallel, the Spanish authorities would not be expecting this notification as implying any major delay in the process of adoption of these new regulations.

The main features of the two draft decrees can be summarized as follows:

1. Draft Decree on Slots

This draft regulation is the first step that should lead to the offering in Spain of one of the key products for the industry, which was missing from the currently existing catalogue of allowed games. The text published by the Spanish authorities is aimed at ensuring a good balance between the possibility of offering competitive slot products with responsible gambling standards. 

The concept of “slot machine games” is quite broad, being defined as any game that, in consideration for the price of a play, allows the player to use the game with the purpose of obtaining a combination of signs or graphical representations that, pursuant to the applicable particular rules of that game, implies being awarded with a given prize. Such an abstract definition would appear to allow the operation of quite a large range of slots games.

The draft regulation sets forth a number of features of the slot games that will be available under this new regulatory framework. The most relevant of those features would be the following ones:

-     The operator is going to be required to provide to the player access to the applicable particular rules of the game in question. These rules shall identify the key features of the game, including the prizes offered as well as the list of combinations that will be awarded with prizes. Particularly, these rules shall contain information on the percentage of return of prizes to the players in the game in question.

-     The draft introduces the possibility for the licensed operators to offer progressive jackpots (“botes progresivos“). Such  jackpots are defined as the “accumulated prize that the operator offers by using a part of the price of each played play” (unofficial translation of the original Spanish text). The offering of these jackpots shall be differentiated and specific for each one of the games. Moreover, the draft decree would forbid any “guaranteed jackpot” (i.e. any jackpot that is totally or partially funded by the operator itself or from  sources other than the money paid by the players involved in that game).

-     The draft also contemplates the possibility of offering the slot games on manual and automatic play modes. In the case of the automatic play mode, the player shall be required to configure the number of plays he/she wants to execute with the automatic mode, with a maximum of 25 plays.

-     The maximum and minimum price of each play will be defined by the operator in the corresponding particular rules of the game. The maximum amount of money that the player will be entitled to gamble with slot games will not exceed the balance of his/her account at the moment of launching the corresponding playing session.

-     The player accessing the slot games is going to be required to configure his/her playing session settings in order to define the time that the session may last as well as the maximum amount of money he/she will be allowed to spend. In addition, the player will also be required to define how often he/she will receive warnings on the time spent playing (being the maximum term for the display of each one of this warnings every 30 minutes).

-     Each play will have a minimum time of 3 seconds.

-     The operator is going to be required to pay the prizes to the player after a successful play (i.e. a play where the player has obtained a combination that, pursuant to the particular rules of the game, is rewarded with a prize.

-     At the end of each playing session, the operator will be required to generate a “document” (likely a pop-up or notification screen) summarizing the amounts put at stake during that session and the results obtained.

Express reference is made to a new duty applicable to licensed platform/network/software providers. Such type of companies when licensing their platform/network/software to licensees for the operation of slot games are going to be required to implement the technical measures required in order to guarantee that the licensed platform/network/software are only made available to players located within the Spanish territory through the offering made by an operator that has the required licenses in Spain.

2. Draft Decree on Exchange Betting

This draft regulation is aimed at covering the hole that existed in the Spanish regulatory framework in regard to this type of betting. Take into account that exchange betting was already accepted in the Spanish Gambling Act (adopted on May 2011) as a valid system of betting, but the lack of secondary regulations articulating the offering of this type of products has impeded the corresponding exploitation in Spain.

In the text that has been published today, exchange betting is defined as any “bet resulting from matching an offered bet and a counter-offered bet, both issued by different players on a particular event or market in which the gaming operator acts only as an intermediary and guarantor of the amounts placed among participants in such bets“.

It is important to highlight that, contrary to the approach followed in regard to  the other types of regulated bets in Spain -pool and fixed-odds betting-, the Spanish authorities have decided to consolidate in a single decree the provisions referred to exchange betting related to sport, horse racing and social events. By doing so, the operator aiming at offering this type of bets will be required to have just a single license (instead of three).

Among other relevant features, the published text introduces the need to offer to the player learning materials on the specificities of this type of betting products. Moreover, the draft decree sets forth a regulatory system of matching of bets which is very similar to those applying in other EU jurisdictions such as Italy or UK.

As mentioned above, any interested party is entitled to file its comments on these two draft regulations until March 27. Should you require any assistance on this, please do not hesitate to contact  [email protected]