Latino America

The season of expos and conferences in Latin America began with Fadja 2017 in Bogota during the last week of April and will now continue almost without stopping with Sagse Panama on 10-11 May, under the direction of legendary Giorgio Gennari, and then Juegos Miami, from May 31 to June 02.

Although the rest of events are June, we list them now to help along with some forward planning. The Caribbean Gaming Show returns with true Caribbean flavour in Montego Bay, Jamaica and is followed by the 2017 PGS in Lima, the Brasilian Gaming Congress in Sao Paolo and, on June 28, the Zitro Experience will light up Mexico.

So without further ado, we have to prepare reservations and begin packing our cases because we will try to be at all these major regional events, where one hopes to see you all there!

Cheers,

Ricki.

Privatization of Brazil’s lotteries would raise R$12 billion in taxes

The Lotex privatization is in the National Privatization Plan (Plano Nacional de Desestatização – PND) as part of the Caixa Nacional business structure, which is being planned for sale by the Banco Nacional de Desenvolvimento Econômico e Social (BNDES).

The federal Government relies on privatization of lotteries to double tax revenue collection from Brazilian gambling. With experienced companies in the lottery sector operating electronic games around the world, the economic team wants to bring investors to the Brazilian market and believes that the volume of revenue from taxes on lotteries can quickly jump from R$6 billion to at least R$12 billion, to help strengthen the National Treasury over the next few years while the public-sector finances remain in the red.

However, before privatizing the lottery sector, which is currently a monopoly of the Caixa Econômica Federal, the Government has divided the lotteries business into two companies that will be auctioned: Lotex (the instant lottery, such as the scratch cards), which already exists in Brazil; and the so-called “SportBeting” (referred to as a lottery; for example, the team that will win a game and score predictions made over the internet). The latter has not yet been created in the country, but Brazilians already participate in this kind of betting using sites located overseas.

A report has found that Government House is about to send to Congress a bill that will allow the operation of sports lottery (betting) and, more importantly, that allows online betting. A government source said that “tax revenue from both companies when operating fully will more than double the federal collection.” The idea is to amend a provisional measure (MP) that was abandoned after the opinion of the Attorney General.

The Lotex privatization has already been approved by legislation and is in the national privatization Plan (PND) within the infrastructure of Caixa. The economic team hopes to launch the sale bidding process of Lotex in August, with approximately 100 days until the auction date in November. The idea is to anticipate that term by a month, as it is not a complicated auction, and with that in place the new company would be operating by the end H1 2018.

The auction bidding of the two companies is being prepared by BNDES. SportBeting (lottery) must be created within the infrastructure of Caixa and passed as a gambling private initiative at the beginning of 2018. The sale of Lotex has already been entered in the Accounts of the Government as a one-off revenue to close this year’s budget. The sale of SportBeting is already part of the 2018 budget.

Caixa will continue running the Lotteries that operate today, such as the Mega-Sena. The two lottery companies to be auctioned off will have the State-owned bank as a partner with a minority stake. The size of this participation will be set by the Government.

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Auction prices for the lotteries will depend on what Caixa’s participation will be in the operation. The main advantage for the public coffers, however, is not on the value of the sale but in the additional revenues that will be generated over time.

COLOMBIA – Baloto will increase revenue by 30% for Health sector

Coljuegos, the State-owned company that regulates gaming in Colombia, announced in Bogotá on April 19, 2017 that from the date of the changes to the lottery game that came into effect the following day on Baloto Revancha, Colombians will be able to win a greater number of prizes, an accumulated amount higher than previous years, and a substantial increase in financial resources that Coljuegos collects to finance the Colombian Health sector.

Juan B. Perez Hidalgo, President of Coljuegos, said: “Baloto will now feature a dual matrix where players can choose five numbers from 1 to 43, and as a novelty a Super Balota with numbers from 1 to 16 – that is 6 numbers in total”. With these changes, Baloto will award prizes to players starting with just one correct number, (the number in Super Balota), and will offer eight categories of secondary prizes.

“In its 16 years of operation, this game has transferred the public finances more than 1.09 billion pesos. Only in the last five years the contribution in terms of VAT amounted to 266.464 million pesos”, added Perez Hidalgo. “With this advance we also seek, of course, to place the game in tune with the big lotto games in the world”.

Baloto is the game with highest percentage of revenue transfers to the Colombian health sector, provided for by legislation on exploitation rights by gaming operators in this industry. In fact, from Thursday April 20, transfers equivalent to 32.5 per cent of Baloto’s gross income will go to the health sector. “Baloto will generate 30 percent more revenue for the health of Colombians and that is an achievement that we should highlight with the changes that we have carried out in the game”, said Perez Hidalgo.

So far Baloto has handed out more than 1.76 billion pesos in secondary prizes to Colombian winners, and we must also remember that the game has more than 14,000 outlets that sell Baloto Revancha in the country. “One of the objectives of Coljuegos is the strengthening of the gaming portfolio so that it enables us to have a strong industry and generate increased revenue to finance costs of the health service for the benefit of Colombians,“ concluded the Coljuegos President.

MEXICO – Representatives ready to shut down National Lottery

As in most countries with Hispanic ascendancy, lotteries are run by local governments, either state or provincial, as lotteries were created to be sources of income to help the needy. In Peru, for instance, lotteries are run by public charities.

Similarly, in Mexico the Lotería Nacional para la Asistencia Pública (Lotenal) is the institution set up by the Mexican Government and responsible for running lotteries and legal games in the country with the aim of obtaining financial resources, through the sale of sweepstakes lottery tickets products.

Currently in Mexico, Lotenal has recorded losses of 500 million pesos, about US$27 million up to 2015, as reported by Representative María del Rosario Rodríguez. Consequently the Federal National Audit Office has called for the closure of this gaming organisation.

In mid-April, Mexico’s official opposition, Partido Acción Nacional (PAN) Lower House members proposed legislation to terminate Lotenal on the grounds that this institution no longer fulfils functions granted by charter to contribute resources to the country for financial public services.