Gonzalo Rosell: "I hope more LATAM countries join in regulating the online gaming industry in an appropriate manner"

The President of the Peruvian Association of Online Sports Betting and Related Activities (APADELA), Gonzalo Rosell, said that the online gaming market in that country "maintained its growth trend" in 2024, during the consolidation of its regulatory framework.

In an interview with Yogonet, Rosell said he hopes that "more countries in the region will join in appropriately regulating the gaming industry", to facilitate the management of formal operators and with a tax framework that is not confiscatory.

Furthermore, he fiercely questioned the Peruvian Ministry of Economy and Finance (MEF) for imposing the Selective Consumption Tax (ISC) on online gambling, a fact that will imply "complex and deep modifications in the technological platforms".

What is your assessment regarding the gaming sector in Peru in 2024?

The sports betting and remote gaming market in Peru maintained its growth trend during 2024, amid intense competition among existing operators and new entrants attracted by the recent regulation. This led to a notable increase in the levels of investment in communication, marketing, and sponsorship.

On the other hand, it has been a challenging year as we have had to go through the process of certification and homologation of our technological platforms to obtain operating authorization from the regulator.

Which industry event do you consider was the most relevant of the year? Why?

I consider that, at a national level, the recent PGS 2024 Forum has been the most relevant of the year because it was an event specifically focused on the impact of the recent regulation of the remote gaming and remote sports betting industry, and had as exhibitors the full team of the General Directorate of Casino Games and Slot Machines, as well as laboratories involved in the homologation processes, and experts in legal, regulatory and fiscal matters applicable to the industry.

What challenges do you identify for the gaming sector with a view to 2025 in Peru?

The biggest challenge for the industry in 2025 is to deal with the arbitrary and senseless imposition of the recently approved Selective Consumption Tax on remote gaming and remote sports betting, which will only contribute to the illegality of the industry. We will implement the necessary legal protection measures to provide us with a reasonable period to comply.

The application of the ISC requires complex and deep modifications in our technological platforms designed with international standards, to carry out the correct calculation and withholding of the tax, taking into consideration that our operations include millions of daily transactions carried out through thousands of gaming accounts. This requires months of adaptation (at least six to eight months), weeks of re-certification (at least four to eight weeks), and weeks of re-approval (at least four weeks) of the technological platform by the regulator MINCETUR, as required by Law 31.557, Law 31.806 and their respective regulations.

In addition to the technical challenge, the 1% ISC on the amount wagered represents such an onerous burden that it will discourage operators from seeking to formalize, and will give illegal operators a competitive advantage that will jeopardize the sustainability of the formal gaming industry.

2024 was a relevant year in Latin America, with the approval of new regulatory frameworks. What are your expectations for this region?

I hope that more countries in the region join in appropriately regulating the gaming industry, without overcomplicating the management of formal operators, and without over-taxing with confiscatory taxes or taxes that are not in line with the reality of the industry. The regulatory issue cannot be misaligned with the tax issue.

An industry as digital as remote gaming and remote sports betting is technologically very difficult to control. Therefore, crossing the line of reasonableness only generates perverse incentives that discourage formality and encourage illegality in a highly digital global industry. In Peru, we have had a good experience with the regulatory team of Mincetur, but unfortunately, it has been overshadowed by decisions of the MEF in tax matters.

What message do you have for the industry at the end of the year?

For formal operators, remain committed to the responsible development of our industry and persevere in staying within formality, while we continue to educate MEF officials that the current bad taxation goes against their own interests of collection and formalization.