Paraguay lawmakers approved a bill that will stop the privatizing of the country’s gambling regulator, the National Gambling Commission, which delegated its slot machine control over a private entity via a controversial contract last year.

Municipalities to Authorize Slot Machine Operations

Aimed at protecting minors from the influence of slot machines, the Senate approved a bill that prohibits slot machine operations at locations that are not gambling sites, including bars, warehouses, shops and others.

The bill that is also looking to rectify the situation in which the National Gambling Commission (Conajzar) had delegated its powers over the authorization of slot machine operations at non-exclusive gambling venues to iCrop SA was sent to Paraguay President Mario Abdo Benitez to be signed into law or vetoed.

In essence, the new bill requires all slot machines installed at non-exclusively gambling venues and hence, being accessible by children, teenagers and young people, to be removed. It is expected that the new bill, if enacted into law, will affect around 50,000 slot machines, giving the power to authorize slot machine operations to the municipalities.

Under a contract signed between Conajzar and iCrop SA last year, the private entity was delegated the right to authorize slot machine operations at non-gambling venues, as well as collect the lion’s share of the taxes from such operations, effectively privatizing the national regulator.

Ongoing Prosecution against Former Regulator’s Members

Back then, local media ABC estimated that from more than $2.15 million in tax revenue, just over $650,000 will go to the state and the President asked the National Anticorruption Secretariat (SENAC) to investigate the contract.

According to the Minister of the Secretariat René Fernández, the regulator did not respond to two information requests related to the contract investigation. Further, Fernández outlined the lack of transparency within the regulatory body, as its website failed to provide access to public documents.

The new bill also establishes sanctions for violations of the prohibition on slot machine operations at non-exclusively gambling locations.

Currently, Paraguay authorities are prosecuting eight people including former Conajzar head Báez and the head of the Directorate of Charity and Social Assistance (DIBEN), as well as other former members of the regulatory body, for their part in orchestrating the contract with iCrop SA and personally benefiting from the agreement.