Mexico’s New Reform Seeks to Ban Slot Machines

Posted on: September 13, 2023, 07:58h. 

Last updated on: November 17, 2023, 07:03h.

Erik Gibbs Read More
Expertise: Asia Pacific Gaming, Gaming Business, Global Gaming.

President Andrés Manuel López Obrador has initiated new legislation recommending a ban on all slot machines in casinos across Mexico.

A slot machine showing a payline of three skulls
A slot machine showing a payline of three skulls. Mexico may move to eliminate all casino slot machines unless there’s a change to existing regulations. (Image: Pinterest)

The federal government is preparing a reform to completely prohibit slot machines in casinos that were legalized during former president Felipe Calderón’s administration. The same received unanimous support by the Supreme Court of Justice in 2016.

The Ministry of the Interior set the wheels in motion last week when it published a draft reform to the Regulations of the Federal Law on Games and Sweepstakes (RFLGS). This would eliminate “draws of numbers or symbols through machines,” which is a direct reference to slot machines.

Loophole Found

Obrador’s stance has been that many casinos illegitimately received their licenses when Calderón was in power. Local governments have still been allowing new casinos to open their doors, even though Obrador has decided that they’re illegal.

Based on the way he and his advisors interpret the law, the Directorate of Games and Sweepstakes, which reports to the Ministry of the Interior, is the only entity in the country that can grant casino permits. Therefore, the municipal license has no reason to exist.

The licenses are currently under review, which has already led to the casino market experiencing some shrinkage. However, the measure hasn’t been 100% effective at preventing new casinos from emerging.

To justify the new measure, the government argues that these machines are not permitted by the RFLGS. This only authorizes dominoes, chess, checkers, bowling, billiards, dice, bowling and raffles. Furthermore, it asserts that Mexico’s Congress hasn’t made changes to the law since 1947.

The reform will not be retroactive, which offers some relief if the measure survives. The 444 casinos currently operating in the country will be able to maintain their slots, but only during the validity of their current permits.

Those permits include another 408 casinos that are not open. If the operators intend to move forward with those properties, they will have to do so without any slots.

Online Gaming Takes Over As Land-Based Gaming Falters

The state of land-based casinos has helped facilitate a rise in online gaming, at least for now. Statista data indicates that Mexico is one of the countries with the most daily visits to online gaming platforms in the world.

Furthermore, according to data from the International Gambling Report, more than 60% of people who bet online in Mexico prefer these platforms to traditional establishments. Regarding their preferences, sports betting, lottery draws, instant lottery, slot machines and roulette stand out.

These figures show the evolution of online gaming in the country, despite the fact that it is not completely regulated as it is in other countries. This means, according to government data, that over 50% of the platforms are not under the control of the National Directorate of Games and Sweepstakes.

Ultimately, this is likely going to put the iGaming segment in the same situation the land-based segment is currently dealing with. If so, it could spell more trouble for online gaming operators.