WILLEMSTAD - Sub-license holders are allowed to continue operating under their master license holder's current license for a period of eighteen months after the implementation of the new gambling law. However, they must submit an application for their own license within three months of the enactment of the National Ordinance on Games of Chance 2023 (LOK).
According to the Social and Economic Council (SER), this proposal does not clearly specify which provisions remain valid after existing sub-license holders have submitted a license application that has not yet been granted.
The SER unanimously concludes that it is neither desirable nor responsible, considering the objections and remarks raised in their advice, to continue the legislative process without taking into account these objections and remarks from the SER.
Especially now that the Minister of Finance, Javier Silvania, has the ambition to develop the Curaçao online gambling industry into the ‘Next Big Thing’, from which real economic, fiscal, social, and societal benefits can be derived, including increased revenues for the country and more highly productive jobs for the local population.
The Council believes that the minister is initiating the process too hastily. Such a course of action is not responsible for ensuring the quality of the legislative process, according to the SER.
The LOK 2023 concerns purely framework legislation, where the substantive standards for the organization of supervision in each gambling area are not included in the bill itself but will be regulated through implementing regulations specific to each gambling area.
The SER considers it important to draw attention to the fact that these implementing regulations, to the best of the SER's knowledge, have not yet been drafted or submitted, resulting in insufficient visibility of how the granting of licenses and the supervision and enforcement will carried out in practice.
Many relevant matters have not been regulated by national decree containing general measures, and the intention to do so has not been made known. The inevitable consequence of this is a great deal of uncertainty and ambiguity within the sector.
In 2006, the online gambling sector in Curaçao was de-risked by the financial sector, particularly correspondent banks. This means that local online gaming companies do not have access to local banking services. As a result, Curaçao is not attractive to major online gambling operators.
The SER also believes that substance requirements, such as the number of people employed in Curaçao and having an actual office on the island, could potentially hinder the success of the legislation in achieving its objectives.
Especially in the short term, as there not enough qualified and trained personnel in Curaçao to meet the substance requirement right at the beginning of the new regulatory regime.
The implementation of the LOK 2023 will impose a significant workload on the new supervisory authority CGA (Gaming Control Authority) because existing companies in Curaçao must apply for a license within three months of the law coming into effect.
Staffing and Governance
The current staff of the CGB (Gaming Control Board) that will transition to the CGA is already experiencing shortages of personnel.
The composition of the Supervisory Board at the regulatory authority is also considered too narrow by the SER.
Consideration should be given to the nature and size of the company and its operations, as well as the desired expertise and background of the commissioners, especially the nature of the activities, degree of internationalization, scale, and specific medium- and long-term risks.
Furthermore, the fact that all financial resources of the CGA come from the national budget undermines the independence of the regulator. According to the SER, there seems to be no healthy financial starting position for the CGA, given the provision regarding the funds of the CGB that are required to be deposited into the national treasury after the implementation of the LOK 2023. This provision may result in the (temporary) paralysis of the CGA.
The SER also raises questions about the extent to which sufficient attention has been given to the implementation of objectives aimed at ensuring a healthy gambling offering, including the prevention and combating of gambling and gaming addiction, protection of vulnerable individuals, and safeguarding the reputation of Curaçao as a gambling jurisdiction.