Chile Senate Economy Committee Votes to Prohibit Private Online Gambling and Undermine Licensing Framework

Chile’s Senate Economy Committee has approved amendments that would prohibit private online gambling. The three to one vote with one abstention on November 9 puts the government’s proposed licensing framework in doubt.

The committee reviewed two proposals that prevent private operators from offering online betting. They differ on penalties and enforcement. Gastón Saavedra, committee chair, said the texts will be merged at the next session before moving to the Senate Finance Committee and full Senate.

Amendments Shift Away From Government Licensing Plan

The decision departs from the framework proposed by President José Antonio Kast’s government in October. That model included five-year licences, 19% VAT on the difference between bets and prizes paid, and an additional 3% levy.

One proposal, from Senate President Paulina Núñez and María José Gatica, rules out private licensing and allows courts to permanently block illegal betting websites. It restricts payment services and advertising for unauthorized gambling. Aggravated cases, including those targeting minors or defying blocking orders, carry up to 15 years in prison and fines of 10,000 UTM.

The second proposal, from Saavedra and Diego Ibáñez, prohibits operation, offering and advertising of online betting platforms. Any platform accepting bets from Chilean customers is considered to operate in Chile regardless of server location. Polla Chilena de Beneficencia, Lotería de Concepción, authorized racetracks and land-based casinos are exempt. Penalties include prison terms from 541 days to five years and fines of 200 to 1,000 UTM. Internet providers, app stores and payment companies must block access.

Reactions Expose Enforcement and Competition Risks

Sebastián Vallebona, deputy finance minister, criticised the outcome. "We are losing the opportunity to debate regulation that focuses on protecting families, preventing minors from accessing gambling and preventing an increase in gambling addiction," he said.

Independent Senator Matías Walker called prohibition the wrong path. "I think prohibition is the worst path," he said. "It’s the best scenario for the companies that have never wanted to regularise, that have never wanted a state licence, that have never wanted to pay taxes."

The Agrupación de iGaming Responsable warned the ban creates a market monopoly and eliminates competition. "These safeguards are not provided by prohibition, but by a regulatory framework that addresses both the problem and the solutions. Without legislation, there is no protection," it added. As reported by World Casino News, the market remains unresolved. Operators have registered and paid VAT since July despite a Supreme Court ruling ordering unlicensed sites blocked. AGR president Sandra Kemp previously described the situation as "applying a patch when we need a law."

The Chamber of Deputies has approved the broader bill and the Senate has passed it in principle. The committee’s next session will combine the two prohibition texts. This leaves enforcement against offshore platforms uncertain while favoring state-linked entities and limiting licensed market entry.