This is a guest contribution by Apuestamil CEO Victor Espinosa. If you would like to submit a contribution please contact Bill Beatty for submission details. Thank you.
In recent weeks, Colombian Government finally took a step forward in terms of regulation and legislation of eGaming, by interpreting and legalizing operation and licensing of state-of-the-art games and dynamics present today worldwide. Government created a clear framework for companies that are willing to operate e-gaming mechanics in Colombia, such as sportsbooks, poker, fantasy sports, eSports, promotional games and online casino, among others. This article explains briefly the main aspects of the “EGaming Act” that was approved, in terms of taxes, licensing, opportunities and market challenges.
The Act states a levy of 15% on gross gaming revenue (GGR) when the return to the player, according to the rules of the game, is equal to or greater than 83% of the expected value of the bet. Additionally, operators of the games must pay a fixed amount for getting and maintaining an eGaming license, equivalent to eight hundred and eleven (811) monthly legal minimum wages (that is USD $200.000 approx.) for each fiscal year of continuing operations. It is important to note that the Act is practical, given that it doesn’t differentiate games by its nature (e.g. online poker vs online sportsbook), allowing a huge range of mechanics to be offered to players, simplifying legislation and licensing process for operators at the same time.
The Law and its related articles, also makes a distinction between games of chance and skill games. It states that when games are not defined by luck, chance or coincidence, but by the ability and skill of the players, operators will not be subject of levy or fixed gaming license. This is a big opportunity for any operator interested in promoting fantasy sports in Colombia. This distinction will open in the short term, a technical-academic debate due to the skill nature of this particular game. There is growing demand and interest in it by a new generation of young players, which are not attracted to the current offer of traditional old games.