Just two weeks after the president of Mexico announced that the country would be putting out a ban on slot machines in casinos and gaming halls, representatives from the gambling industry are dusting themselves off and getting ready to launch legal challenges to defend their industry. They’re gearing up for what many expect to be an extended legal battle.
The president of the Association of Permit Holders, Operators, and Suppliers of the Entertainment and Gambling Industry in Mexico (Aieja), Miguel Ángel Ochoa, has outlined some of the battle plans this week. He has already briefed the local media that he would be putting up his defence strategy on two different fronts – protecting the industry’s interests and lobbying for much-needed changes to the Federal Law on Games and Sweepstakes.
The federal government issued a decree on November 16 through the Official Gazette of the Federation (DOF), announcing a cessation of granting any new permits and not renewing any ones that are already in existence for slot machine operations. Aieja states that this unilateral decision will completely cripple the regulated gaming industry… and the country as a whole.
Slots Are Big Business
Slots represent a massive 85% of the industry’s operations. As such, these new unwelcome limitations might mean an absolutely devastating loss of as much as MXN 12 billion (US$700.32 million) in revenue for the current federal government.
The criticism coming from the gaming sector is mainly directed at the National Commission for Regulatory Improvement (Conamer). Despite conducting public consultations before the announcement, it completely disregarded the industry’s feedback.
As a result, Ochoa confirmed that Aieja would go ahead and pursue legal avenues in order to prevent medium-term closures of businesses. This impending impact is likely to have a huge impact on most casinos, with most permits expiring between 2028 and 2033. A complete ban on renewing any slot machine permits is set for 2038.
Aieja has emphasised that Mexico’s Federal Law on Games and Sweepstakes hasn’t seen significant changes for about 80 years. So, instead of an impulsive banning of slots, it is simply suggested that updating the country’s gambling laws would be a much more sensible approach.
The Death Knell for Casino Employees
During the evaluation of the newly proposed regulations, casino operators voiced their concerns that these measures would not only impact gaming options, but this move could also put players off of these gaming venues altogether. They even gave them feedback from industry workers who were obviously very concerned about the uncertain fate of their jobs.
There are 429 casinos across the country, generating around 180,000 direct and indirect jobs. With this current slot ban in place, there is a very real possibility that over 100,000 positions will be at risk over the next six years. Moreover, there is a warning that companies involved in the manufacturing of slot machines may also withdraw their investments from Mexico.
Ochoa stated that the gaming industry has been engaged in ongoing dialogues with the Ministry of the Interior and legislators regarding this situation. Aieja is hoping to start discussions regarding new regulations next February during the last session of the current Congress.
The goal is to create an environment where everyone’s concerns are taken into account – and to achieve a more balanced approach to address essential regulations and the sustainability of businesses in the sector.
Still Some Hope Left?
It seems unlikely that Andres Manuel Lopez Obrador’s stance will change any time soon, but Mexico’s gaming industry might have a chance if there is a change in leadership. Mexican presidents are only allowed to serve one six-year term… and Obrador’s term ends next year.
This means the country will be getting a new president, and the current frontrunner is former Mexico City mayor Claudia Sheinbaum, an ally of Obrador. While not a massive supporter of gambling, she also isn’t known to be particularly against the industry either.
Recognizing the industry’s contributions to the government, her stance could prove beneficial as Aieja seeks support.
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Last Updated: December 14, 2023