Chilean casino tenders falter, operators blame flawed model

Chile's gaming regulator, the Superintendencia de Casinos de Juego (SCJ), faces a significant setback as casino tenders for Iquique and Viña del Mar attracted zero bids. This lack of interest necessitates the initiation of entirely new bidding processes for these lucrative locations. Meanwhile, the tenders for Coquimbo and Pucón saw minimal competition, with only one applicant each: Casino de Juegos de Coquimbo S.A. and Casino Volcán Pucón S.A., respectively.

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This result is not an isolated event, but a new demonstration that the bidding model implemented since 2015 presents structural design flaws.

Casino operators Marina del Sol and Dreams have voiced strong criticism regarding the tender conditions. Marina del Sol stated that the low participation in the recent tenders highlights "structural design flaws" in the bidding model adopted in 2015. The company argues that the process urgently needs a regulatory review to foster genuine competition.

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The technical bases of the tenders for operating permits for the casinos in Iquique, Coquimbo, Viña del Mar and Pucón imposed excessively burdensome conditions without justification, and therefore did not promote competition.

Dreams echoed these concerns, pointing to "excessively burdensome conditions without justification" in the tender documents for Iquique, Coquimbo, Viña del Mar, and Pucón. For Iquique, the terms stipulated that all infrastructure built would revert to the municipality at the permit's end without any compensation, effectively turning investments into unrecoverable sunk costs. In Viña del Mar, beyond a substantial annual fee, bidders faced demands for significant improvements to Avenida Perú and a requirement to maintain 100% of the existing workforce.

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In Iquique, the conditions required that at the end of the permit, all works would remain the property of the municipality, without any right to compensation, turning the investment into a non-recoverable sunk cost.