Paraguay Regulator Faces Legal Action Over Sports-Betting Tender

January 20, 2023
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Paraguay’s beleaguered National Gaming Commission (Conajzar) could be facing legal action from B-Gaming and Gambling SA Consortium, which narrowly missed out on the country’s sole sports-betting contract.

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Paraguay’s beleaguered National Gaming Commission (Conajzar) could be facing legal action from B-Gaming and Gambling SA Consortium, which narrowly missed out on the country’s sole sports-betting contract.

The tender process held last year was alleged to be corrupt from the outset, with Conajzar already mired in lawsuits from a slot machine contract scandal that took much of the past two years.

At the time of the tender, it was alleged that the specifications would make it nearly impossible for anyone but Daruma Sam SA, which eventually won the contract and held it previously, to be considered.

But B-Gaming and Gambling SA Consortium tried, along with a third contender in the form of businessman Luis Carlos Alder Benítez.

Financially, the partnership of B-Gaming and Gambling SA Consortium offered the most appealing terms, with 27 percent of gross gaming revenue going to Conajzar. Daruma Sam SA offered 22 percent, while Alder Benítez offered 23 percent.

But Daruma Sam SA, operator of the Aposta.la online betting platform, won the contract anyway, despite calculations that its bid would mean up to $1m less per year for the government.

According to Néstor Povigna, the lawyer for B-Gaming and Gambling SA Consortium, Daruma Sam’s bid should have been disqualified and it did not file all of the correct documentation, a shortcoming that has disqualified other bidders on Conajzar contracts in the past.

"The appeals that we had presented were denied by Conajzar, one after the other. Now we have to file a civil lawsuit,” Povigna told Yogonet, referencing the appeal that he filed alongside Alder Benítez’s attorneys. That appeal was rejected several weeks ago by Conajzar.

In response, on January 3, Alder Benítez filed an urgent measure with the courts to suspend the bidding process, which has yet to receive a response.

“The executive branch endorsed the arguments of the Treasury Attorney's Office. Apparently, these bodies did not see imperfections in the bidding process,” said Povigna.

Paraguay President Mario Abdo Benítez signed a decree on January 13 that awarded the five-year contract to Daruma Sam but it will not be official until the Ministry of Finance takes care of relevant administrative procedures.

The threats of litigation over the sports-betting contract come after officials told local media outlet ABC Color that Daruma Sam SA is also being investigated for money laundering.

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