Europe has definitely made the greatest progress in terms of iGaming regulation and legalization. More and more EU member states have been adopting regulatory frameworks that have allowed them to regulate their online gambling markets in a manner consistent with the growing demand for online gaming and betting offering.
And while several US states have been trying to legalize and regulate one form of online gambling or another, several Latin American countries have made a solid statement that their iGaming markets may have reached the point where regulations should be introduced.
With population of over 120 million people, Mexico is the world’s largest Spanish-speaking and one of the largest countries in the Latin American region. It has been more than two years now that local lawmakers have been working on a new regulatory regime in relation to the way online gambling (and gambling as a whole) services should be conducted.
There are several major international iGaming operators to be running such services within the country’s borders, but they are operating in a gray zone with no explicit regulations of what is legal and what is not. In other words, online gambling is not exactly allowed in Mexico, but is also not explicitly prohibited. However, the status quo may change soon, or not so soon, depending on the progress Mexican legislators are to make toward the eventual regulation of the local market in the months to come.
And the fact that big industry players have expressed interest in the country’s market, and are currently providing services there, speaks volumes of the potential it may be holding.
Why Could Mexico Turn Into an Attractive iGaming Jurisdiction?
Miguel Angel Ochoa Sanchez, President of the country’s gambling regulator, AIEJA, has been among the staunchest supporters of Mexico’s iGaming legalization effort. According to the gaming official, the Mexican online gambling market may prove to be particularly lucrative, generating hundreds of millions of dollars in tax revenue. Mr. Sanchez has also pointed out on numerous occasions that gambling products of this type are already very popular among local players. It is believed that the creation of a safe gaming environment could additionally boost activities in future.
According to analysts, the country holds great potential to turn into a popular hub for international iGaming operators to base their Latin American offices in. The great number of English-speaking residents, the business-friendly environment, and the relatively cheap labor force have been pointed as good reasons for international companies to invest in the local gambling industry.
iGaming Regulatory Process
It was in late 2014 when the most significant step toward the regulation of online gambling was made by Mexican lawmakers. A comprehensive gambling bill, containing a regulatory framework for the regulation of the local industry, was passed in the lower house of the country’s Senate. At the time, it was believed that the proposed legislation would be sped through the government and would be quickly signed into law.
And expectations were not met. Multiple delays prevented the bill from passing the remaining legislative hurdles and be eventually adopted. Hopes were that this would finally happen in 2017, but according to Mr. Sanchez, a vote on the proposal could be further delayed to 2018. Last year, the gambling official was much more positively disposed towards the eventual iGaming market’s regulation. He told local media that the country’s new law would come into force before the end of 2016.
Here it is important to note that the new regulatory framework is also concerned with the regulation and monitoring of land-based gambling operations. It contains provisions for the way both online and brick-and-mortar gambling businesses would be licensed, regulated, and taxed.
In a recent interview to local media, Mr. Sanchez said that lawmakers should act more quickly on the proposed legislation, as its adoption would result in significant tax revenue being contributed to the country’s coffers and online gambling proceeds being kept within Mexican borders. At present, the lack of explicit iGaming regulations makes it convenient for international companies to operate in the market without paying taxes.
Companies with Interest in the Market
To support the above statement that Mexico may turn into a popular gambling hub, it should be noted that the country has already attracted quite some attention. For instance, major gambling companies have set offices there. And as mentioned above, there are both operators and providers to have been offering their products and services in Mexico.
It was mere days ago when Spanish gambling operator Codere announced that it has launched a .mx website to provide its offering to local customers. It was also announced later last year that Swedish online gaming developer and supplier NetEnt would supply namely Codere with its products. Merkur Gaming, Kambi, and BetConstruct can also be named among the companies to be operating and providing products in Mexico and to be anticipating the iGaming market’s regulation.
Conclusion
Even though the process of regulation advances more slowly than it should, it is important to note that iGaming regulation in Mexico is not a matter of ‘if’ but of ‘when’. And the popularity of this type of offering, the imminent contribution of tax revenue, and the country’s investment potential are believed to be those most important and solid backers of the above statement about the market’s future lucrativeness. It is now up to legislators to eventually implement much-needed regulation.
