Peru Passes Bill To Amend Online Gambling Law

May 30, 2023
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Peru’s Congress has approved a series of amendments to the 2022 law to fix loopholes and errors in the original legislation to regulate remote gaming and sports betting in the country.

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Peru’s Congress has approved a series of amendments to the 2022 law to fix loopholes and errors in the original legislation to regulate remote gaming and sports betting in the country.

Law 31.557, which was hastily approved by Congress and then enacted in August 2022, was immediately met by criticism from the industry and accused of being a "Frankenstein" piece of legislation cobbled together from various pre-existing bills.

The plenary assembly of Peru's Congress approved Bill no. 3595/2022 on Thursday night (May 25) to fix the law, with lawmakers' saying they had introduced the draft with the “aim of specifying concepts and establishing their scope”.

One of the main errors that has been fixed is in Article 40 of the initial law, which left a loophole that could have been interpreted as meaning that companies based abroad could apply for licences but would be exempt from paying a headline tax of 11.76 percent of revenue. Under the new legislation, both foreign and Peruvian companies will now be obligated to pay.

Other changes include increasing the guarantee that approved operators will have to pay from 200 so-called UIT Peruvian tax units, or approximately US$270,000, to the greater of 600 UITs or 3 percent of annual gross revenue.

The law has also been amended to allow foreign residents and tourists to register to play with Peruvian operators when in the country. The current law allows only Peruvian nationals to register, even though foreign players are allowed to play in land-based casinos.

Further, the permitted domains of licensed online gambling operators will be extended to include dot.com, dot.com.pe, dot.pe, dot.bet and dot.bet.pe. In the prior text, the only domain allowed was dot.bet.pe, which opponents successfully argued would inflict unnecessary migration costs on operators.

The Peruvian Penal Code will also be altered in conjunction with the new legislation, meaning that, potentially, on the day regulation comes into effect, online operators without a licence will be committing a crime. The specific modification can be found in Article 243-C of the Penal Code, handing out a penalty of between one and four years in prison.

Carlos Fonseca Sarmiento, a Peruvian gaming lawyer, wrote on Spanish language media outlet Yogonet that he is particularly concerned with the 120-day period between the publication of a regulatory decree for online gambling and the law entering into force.

Even though the transition period will be increased to 120 days from just 60 days as under the current law, Fonseca opined that it would not be enough time for operators already in the grey market to legally transition or for Peru's Ministry of Foreign Trade and Tourism to handle the anticipated inundation of licensing requests.

The next step for the online gambling law is for President Dina Boluarte to promulgate the new legislation within 15 days and bring the amendments into legal effect.

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