Sports Betting: The Puerto Rican Opportunity
Voyaging into new territories is a critical part of forward-thinking strategies for growth. As we enter a new era of industry, attitudes towards online gaming are shifting on a global scale. Creating opportunities in exciting, newly regulated markets. Some industry commentators believe that Puerto Rico has the potential to be the next online and eSports gaming hot spot.
See below as H.B. Duran of NGame eSports gives us an overview and some context to the potential growth of iGaming in this region
Evaluating The Impact of New Betting Legislation in Puerto Rico
Puerto Rico’s newly enacted Bill 1534 is expected to boost gambling revenue and create jobs in the region. This action follows a trend in which several states and countries worldwide introduce or amend laws to allow online gambling to flourish.
Puerto Rico Gambles on Sports Betting
Prior to stepping down from office, Puerto Rico’s outgoing Governor Wanda Vázquez Garced signed Senate Bill 1534 into law. This bill amends the previous Gambling Law of June 29, 2019, known as “Law of the Gambling Commission of the Government of Puerto Rico” (Law 81-2019).
Bill 1534 seeks to “allow new industries and businesses to create jobs” as well as to “create new sources of revenue to sustain government programs and essential services.”
Most significantly, Senate Bill 1534 opens the door to online betting. Previously, potential gamblers had to register in person. Now, citizens are allowed to register online.
Puerto Rico’s new Governor Pedro Pierluisi will be responsible for implementing the law, at which time operators from the gambling industry will be allowed to go live.
Gaming Laboratories International (GLI) will assist the Gaming Commission in the process, including drafting regulations. In addition, GLI will offer consulting services related to various online gambling scenarios, including esports, traditional sports betting and fantasy sports.
An Online Gambling Movement
Puerto Rico isn’t alone in its pursuit of online gambling legalization and regulation. Canada’s proposed Bill C-13 would legalize single-event sports wagering in the country, which would include esports wagers in a regulated environment either online or in-person.
The United States is also ramping up its efforts to legalize online sports betting. After the U.S. Supreme Court struck down the federal ban on gambling in 2018, nearly 75% of states have either legalized sports wagering or introduced the appropriate legislation. It wasn’t long ago that Las Vegas was the only U.S. location where you could legally place a bet on a sporting event. Much has changed since then.
Now in 2021, several new bills are on file or recently added to the books, including Virginia’s HB1847 and SB1254. Colorado made online sports betting legal in 2020. In New York, Governor Cuomo is pushing for online sports betting, although politicians continue to debate which format would be the most beneficial.
The UK has always enjoyed a vibrant gambling scene, from horse racing to today’s online sporting events. Gambling has increased during pandemic lockdowns. However, government regulators have pursued additional restrictions, including a moratorium on advertising, affordability checks to help curb addiction and tougher license conditions, among others.
Currently, the countries in the UK allow online gambling, but only with companies that possess a local license. Austria, Denmark, Finland, France and the Netherlands operate in a similar manner.
Other countries, including Japan, New Zealand and Australia, prohibit their citizens from gambling and go so far as to block local betting websites. However, online betting continues through foreign companies with little or no effort from the government to prevent it.
Not everyone is in a rush to legalize or even regulate online gambling, however. Several countries, including Bolivia, Uruguay, Venezuela and Argentina do not prohibit online casinos, nor do they offer licenses.
It is clear that government officials recognize that technology has changed the way consumers seek entertainment, for better or worse.
“With the industry open to adopting the latest advanced technologies including virtual reality, augmented reality, blockchain and artificial intelligence, it is clear that technology is going to play a crucial role in redefining the gambling experience and customer interaction as well as industry operations, product lines and services,” according to Deloitte UK.
Esports Betting and the Economy
The Enchanted Island is home to many beautiful locations and unique traditions that draw visitors each year and keep its residents entertained. Puerto Rico’s tourism industry includes its many vibrant casinos. According to Puerto Rico Tourism Co. Executive Director Carlos Mercado, COVID-19 restrictions cost 16 casinos $54 million from July to December 2020 compared to the same period in 2019. From July to December 2019, the Puerto Rico casino industry reported $147 million in revenue but saw it drop to $93 million.
The adoption of Bill 1534 would allow Puerto Rico to not only expand its gambling options to residents but increase revenue through taxation. According to Puerto Rico’s Gaming Commission, a 7% gross gaming revenue tax will be applied to all land-based betting transactions. Fantasy sports and online gambling entry fees will be subject to a 12% tax.
In the United States alone, the sports betting market is expected to reach around $2.75B by 2023, according to a study by GamblingCompliance. By 2030, H2 Gambling Capital estimates it to be worth $81B.
Global consumer surveyors 2CV and market analysts ProdegeMR predicted that global esports gambling revenue would double to $14 billion in 2020, and if lockdowns persist, that number could rise even higher.
Puerto Rico has a growing esports presence, with teams like Kaos Latin Gamers making a name for their native country in League of Legends. Legalizing esports betting in the country would allow local fans to support their home team.
What’s Next for Puerto Rico Online Gambling
Despite all the hype around Bill 1534, esports fans can’t jump on their favorite betting app just yet. Before going into effect, the bill still needs to go through additional congressional voting. It has been a long road for this bill to come to light. Former Puerto Rican Governor Roselló was an active proponent for legalizing sports betting in the country, which would include esports.
He signed the Betting Committee Act in July 2019, which intended to legalize betting in sports, horse racing, fantasy contests and allow casinos to offer betting services on esports matches. Roselló resigned after a scandal, and the bill faced another setback when the Director of Gambling for Puerto Rico’s Tourism Board, Jaime Alex Irizarry, resigned.
It seemed as though online betting was indefinitely on hold, so it’s a good thing for the industry that Governor Wanda Vázquez Garced signed Senate Bill 1534 into law.
Like many countries, the Enchanted Island has suffered losses in terms of revenue and citizen morale as movement and traditional entertainment sources are limited. COVID-19 has left the world in a state of uncertainty, and each city, county, state, and county has its own methods of keeping citizens safe. This makes it difficult to know when physical casinos will reopen at full capacity, much less when travel will become possible in a “normal” capacity.
Until then, leaders are hoping that online gambling will give citizens a way to safely entertain themselves while collecting additional tax revenue for the government. Puerto Rico doesn’t have sovereignty from the United States but enjoys a great deal of native pride in traditional sports. Puerto Rico fields teams in the Olympics, the World Baseball Cup, the Pan-American Games, and the Central American and Caribbean Games, just to name a few. As aforementioned, Puerto Ricans will also be able to cheer on their favourite teams in competitive video game titles.
There’s no doubt that the esports betting world will watch Puerto Rico’s actions with great interest in terms of how legal esports betting plays into the country’s tourism and local engagement.