San José, Costa Rica, since 1956

Casinos Bet Regulation Will Spur Investment

It seems a guy can get just about anything down on “Gringo Gulch,” the San José neighborhood near Parque Morazán famous for its multiple casinos, women for rent and knock-off Cubanos.

A Russian casino company’s plan to add another $5 million complex to the scene sparked angry comments from government officials who formed a commission to look at ways to regulate potentially shady casinos.

At least one unlikely stakeholder completely agrees: The Costa Rican Casino Association itself.

Representatives there say the industry is desperate for regulation that would do away with casinos’ shadowy reputations and make gambling more tourism friendly.

They also say the “clink,” “ding” and “hit me” of Costa Rica’s little casino scene would get a lot louder if legislators could pass a law to regulate casinos and provide investors, not to mention players, with some security.

“It would be prudent to have new regulations that establish security for the state, security for the users, and security for the companies that do this,” said Jorge Hidalgo, vice president of the association and executive president of Casinos Concorde Costa Rica.

By global standards, Costa Rica’s casino industry is small.Hidalgo estimates there are between 30 and 35 casinos throughout the country. The biggest of those doesn’t pass 15 tables and about 250 slot machines.

Though the recently formed government commission wants to look at other ways of putting new regulations into effect, Hidalgo notes that a bill that would put some stiff restrictions on the casino sector has been languishing in the Legislative Assembly for eight years. With that bill passed, the future of the gaming scene would be altered drastically.

Currently, casinos operate under a law that originated in 1922 and covers everything from bingo fundraisers to lotteries to slot machines. Though it’s been interpreted into modernity by courts several times, it still contains some anachronisms.

Association President Rafael Vargas said the law still regulates old Tico versions of games that tourists aren’t familiar with.

“Rummy,” for example, is a Costa Rican version of blackjack found in most casinos here, while “tute” is a game similar to Caribbean stud poker. Another game is the “canasta” version of roulette, which uses a bingo-style basket full of balls instead of a wheel.

“I imagine it gives (tourists) a different impression,”Vargas said.

The bill would solve most of the old law’s problems by creating something resembling a National Gaming Commission that would grant licenses, set rules and regulate.

Most of that is done right now by the 82 individual municipalities, something Hidalgo said causes confusion.

“There could be 82 different criteria on which games are legal and which aren’t.” Other rules would be designed to keep the casino sector focused on providing a service in hotels, rather than offering largescale entertainment to the public at large.

Casinos would be located in hotels of at least four stars with a minimum size of 60 rooms. Those hotels could have a maximum of 10 tables and 60 gaming machines, a number scaleable with the size of bigger hotels.

The bill would also ban the hotel casinos from having their own street entrance.

“It would make it one more service inside a hotel,” Hidalgo said, “more for the guests than for the local residents.”

The regulations would also put restrictions on casino owners and require background checks on capital to make sure the money is clean.

After eight years floating around in the Legislative Assembly, the bill has yet to be brought to its commission or the full assembly to be made law. Janina Del Vecchio, the National Liberation Party (PLN) legislator that heads up the commission where the bill would be brought, said it’s up to the executive branch to decide what bills will get looked at next.

Bills to implement the Central American Free-Trade Agreement with the United States (CAFTA) are currently occupying the assembly’s time.

But a sign the bill may get a hearing soon is the fact that Vice President Laura Chinchilla co-sponsored the original casino bill when she was a PLN legislator in 2000.

Chinchilla is also one of the members of a commission formed to overhaul the 1922 law with the purpose of stymieing the arrival of Russian casino company Storm International. Change is in the air.

“There’s political will,” Del Vecchio said.


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