The Legislative Governance Commission of the Congress of the Republic, chaired by Congressman Fidencio Lima, has given a favorable opinion to a bill for the prevention, regulation, and sanctioning of slot machines and other games of chance in Guatemala. This move aims to address a legal gray area and bring transparency and accountability to the operation of games of chance, known to have wide penetration in the country. The proposed regulation seeks to prevent illegal slot machines and games of chance from operating in places other than those authorized by the state. This bill is a significant step toward safeguarding public order and consumer welfare and re-establishing the government’s right to tax an increasingly unregulated sector within the Guatemalan gaming industry.
Illegal Slot Machines and Games of Chance: A Problem on a National Scale
Illegal slot machines and other games of chance are considered a massive problem by Guatemalan authorities. The vast majority of such machines can be found operating in small businesses and convenience stores. There are said to be thousands of slot machines and other types of machines in stores or without a defined structure, such as stalls or kiosks. Operating completely illegally, none of the owners pays taxes or duties to the state, and the machines are in no way controlled or taxed by the authorities. This widespread illegal activity has deeply affected the Guatemalan gaming industry, making it difficult for legitimate businesses to operate on a level playing field.
Slot Machines and Games of Chance Proliferate in Guatemala
Illegal slot machines and other games of chance have also long been operating freely in Guatemala without proper regulation. Illegal slot machine and game of chance venues have exploited a legal loophole that has allowed them to expand, using laws that have even required them to cease such operations. In Guatemala, some unscrupulous operators have taken to calling their slot machines “toys” or “games” to distance themselves from the sale or placement of “slot machines,” such as those in casinos. As a result, the Guatemalan gaming industry has struggled to maintain fair standards and protect both consumers and investors from the negative effects of unregulated operations.
Slot Machines and Games of Chance Regulation Bill Approved
The current proposal, which has been approved by the Governance Commission of the Congress of the Republic and is awaiting approval by Congress, sets out several measures that ban slot machines and other games of chance and states that the authorities will be obliged to shut down any premises found operating them.
Commission’s Verdict: Bill Aligns with Political Constitution of Guatemala
As part of their evaluation of the approved initiative, the members of the Legislative Governance Commission analyzed all the provisions and announced that they do not contradict the Political Constitution of the Republic. On the contrary, they represent additional support for the legal system and the fight against fiscal fraud and tax evasion, as well as the defense of society.
Lawmakers’ Take on Regulation of Slot Machines and Games of Chance in Guatemala
Legislators have pointed out that regulating slot machines and other games of chance in Guatemala, on the one hand, would ensure transparency and honesty in such operations, protecting users. At the same time, the state would have an opportunity to increase its fiscal income by taxing a more significant part of the country’s budget. However, at this time, illegal operations have been allowed to expand completely outside of the control of local authorities and without any contribution to state coffers.
Proposal Will Legalize and Regulate Slot Machines and Games of Chance in Guatemala
In addition, the document, prepared by the members of the Congress of the Republic of Guatemala and approved by the Legislative Governance Commission, says that it also amends the Penal Code, in the sense that tax fraud on slot machines and other games of chance is now recognized as an independent type of crime. This means that anyone or any legal entity involved in the sale, purchase, importation, or possession of such a machine or its structural elements, disguised as a toy, will be punished with a custodial sentence of no less than 5 years and no more than 10 years. An amount equal to twice the amount of the tax fraud committed will be imposed as a fine on the violator. The fine for such a violation will also be applicable to the machine and equipment that, at the time of commission of the crime, were in the possession of the criminal or were subject to his ownership in any form. All confiscated or detained equipment will be destroyed at the site of their discovery and under the supervision of a representative of the authority who will execute the corresponding requirements, and information about it will be entered into the computer system of the same. The decision to close the establishment due to the use of machines with monetary games other than those provided for by the state has been approved with immediate effect. The owner, administrator, or manager of such an institution and the people who were directly on duty will be sentenced to no more than 2 years and no less than 5 years, and they will pay a fine in the amount of twice the total value of the detained machines. Repeat offenders will be given a prison sentence of up to 7 years and will pay a fine of 3 times the total value of the machines and equipment found on their property. The document also points out the protection of minors and the prohibition of children and adolescents from being in gambling establishments.
On the other hand, the immediate closure of the enterprise is approved, within the framework of the operation of slot machines or other games of chance, in the event of the discovery of persons under the age of 18 on their territory, and if the company’s owner, administrator, or manager and other people on duty on the day of the approval of the order allow the minor to gamble. Sanctioned in the amount of not more than 5 years and no less than 3 years, and in an amount equal to 3 times the value of the equipment held by the criminal on the day of commission of the crime. The new bill also states that if a public official commits the crime of allowing slot machines and other games of chance to be in operation, he will be sentenced to 3 to 5 years in prison. In addition, the individual will be prohibited from holding public office for 5 years after the expiration of the prison term.
An attempt was also made to indicate the most optimal scenario for the legalization and regulation of the slot machine and game of chance business in the country. The issue of legalization, or at least regulation, of such a section of the entertainment industry as slot machines and other games of chance has long been an acute one. As practice shows, the state in such cases suffers most of all, as it does not have an opportunity to collect the necessary taxes from gaming companies. However, the criminal environment also rejoices in such an unfortunate scenario, as it is precisely these opportunities that are exploited by many criminals who violate the law. For its part, local government bodies, such as the Congress of the Republic of Guatemala, cannot help but take such factors as the control of criminal organizations and the provision of tax revenues to the state budget into account. The most practical solution to this issue would be to legalize the operation of such venues. In addition, only companies with the appropriate licenses should be allowed to open a slot machine or any other game of chance. This is an especially important factor as, for example, a company can acquire a license for slot machines and other games of chance. This can help solve the issues of funding state needs, restoring transparency, and supporting the responsible growth of the Guatemalan gaming industry.