Recently, the Governor of Buenos Aires announced that he will be signing a document that would effectively make online gambling legal in the capital province.

How this is going to work, and what are the problems with the regulation? Read in our article.

How Buenos Aires legalization is going to work

Here’s what the Governor has in mind. The only place in Argentina that will be fair game for online casinos is the capital province. That’s only one of the 23 provinces that the country has.

Under the new law, entrepreneurs will be able to license online casinos, horse race betting, sports betting, and other games associated with gambling.

Any casino that wants to register will have to go under scrutiny from the governmental committee that is regulating these matters. Casinos will have to meet 20 requirements that include industry experience. Effectively, this is a way for the biggest casinos that target Argentina to become legal, since they would be the most experienced ones.

The price of legalization is rather small. Casinos will only have to pay 25% tax on their revenue. This is far bigger than what the draft of the legislation said but is still a fair one to pay. Considering the fact that corporate tax will be 25% as well starting from 2020, casinos won’t be treated any worse than any other business in the country.

However, there’s a pitfall. There are only seven licenses to be handed out. That’s right, not every business can get one. With only seven possibilities on the industry’s hands, what can this mean for Argentinian players?

The potential for corruption?

Even though Argentina was removed from the list of countries most ridden with corruption back in 2014, it remains a serious problem in the country. Can this legalization effort be just a ruse to collect money for the wealthy?

There is no precise statistics as to how many Argentinian casinos are there. Potentially, there can be hundreds of them.

Since there are only 7 licenses to be handed out, the politicians that control this process, have a lot of value concentrated in their hands. This may end up in top rating casinos straight out bribing politicians to get the place.

Buenos Aires thinks locally

The decision to legalize an online activity in only one region of the country seems very weird. How is this going to be controlled? Would people who live outside the Buenos Aires area be prohibited from gambling? How is the government going to realize that?

It seems as though legalizing gambling completely would be a much better decision.

This is the problem with gambling legalization

Although inspiring, this case shows many problems that legalization of gambling faces today. The original idea is fine. The taxation rate is fine. But then the government asks casinos to only operate in one region and gives as little as seven licenses.

Considering the fact there is no way Argentina officials can make illegal casinos to stop operation, why would anyone want to even try to get a license? What starts as legalization ends up looking like a monopoly.