OVERVIEW:

POLITICS:

Gaming and politics in Mexico have a lot in common. Both require skill, luck and a calculated strategy in order to come out ahead, regardless of the odds. Democracy only started becoming a reality in Mexico when National Action Party (PAN) candidate Vicente Fox won the presidency of the republic in 2000. For the first time in 72 years, a party other than the National Revolutionary Party (PRI) came into power, establishing a foothold in both the Mexican Congress and at the grassroots level.

As one of his final presidential gestures in concert with Santiago Creel his Secretary of the Interior, former President Fox introduced legislation to the Mexican Congress in September 2004 enacting new but poorly crafted regulations for Las Vegas style gaming under woefully inadequate 1947 Federal Gambling and Drawing Law, both of which remain in effect to this day.

Meanwhile the newly elected President Felipe Calderón has made positive overtones in regards to enhancing the Mexican tourist market. Passage of Class III Las Vegas type casinos into existence would guarantee needed tax dollars, stimulate the Mexican tourist industry, foreign investment, create jobs and expedite development of a world class industry. However, he can only endorse gaming the congress must vote on it and pass the measure.

Fox, the outgoing president, made it clear early in his administration that he favored casino legalization in concept, but his replacement, Felipe Calderon, has not publicly stated a position on the question. However, the prevailing Mexican political agenda makes tourism a high priority for the country’s economic development, along with energy, employment, safety and telecommunications. Given worldwide trends, there certainly is no doubt in the mind of any politician today that gaming is an important element of both the long-range growth plan and the tourism industry in Mexico.

James Jones, the U.S. ambassador to Mexico from 1993 to 1997 and now a consultant with the Washington, D.C.-based Manatt Jones Global Strategies noted that Calderon's family helped start the National Action Party, or PAN, which has close ties to the Catholic Church, a traditional opponent of legalized gambling in Mexico.

"Felipe is not doctrinaire however," added Jones, who has spoken with Calderon on numerous occasions. "He will be looking for sources of revenue in addition to trying to reform the fiscal/tax system. So my guesstimate would be that he would not necessarily be opposed to legalized gaming, might even actively support it."

STATE OF GAMING IN MEXICO PAST, PRESENT, AND FUTURE:

Mexico current gaming business is in its infancy although gambling has been part of the Mexican culture for a very long time taking on legal and illegal forms depending on the interpretation of the law and who one might know that held a position of power and would turn a blind eye and open hand towards the illegal enterprises.

In 1934, President Lázaro Cárdenas banned casino gambling in Mexico (with certain event and/or fair and festival related exceptions). Yet gaming activities continued (at times in clandestine casinos), to the degree that in 1947 the government of President Miguel Alemán promulgated the "Federal Gaming and Raffles Law," still excepting casinos, in order to establish federally regulated controls and a future tax stream for the government. And since then the Law has never been amended nor reformed.

 
Efforts to reform the Federal Gaming and Raffles Law of 1947 heated up in the early 1990s, with the specific goal of reauthorizing casinos, however for a variety of sociopolitical reasons the efforts were never successful.

Actually proposed reform legislation is still in the Chamber of Deputies, the proposed Federal Gaming with Wagers and Raffles Law (2004), although it is buried in committee. The initiative includes casinos and the expansion of related gaming activities, however, drafted in such a way that the casino chapters and interconnected entries could be excised to leave a casino bill.

With the 2007 Mexican Supreme Court decision regarding Class II Electronic Bingo Machines as legal and Class III content not ruled on and falling into a gray interpretation area where they are not legal but not illegal and a big part of the gaming landscape.

In 2010 Mexico joined in with most other countries in the world that engage in state of the gaming business when the Ministry of the Interior dealt the Mexican gaming industry a Royal Flush when it authorized Class III and random number generated games.  This upgrade allows for virtual electronic images to include all major casino games including slots, 21, poker, baccarat, roulette, keno and bingo in a video machine format, all the players favorites.   At this point only paper playing cards, mechanical roulette wheels and Internet casinos remain illegal.  

"THE FUTURE"

Mexico will become the second largest gaming jurisdiction in the world in the next 10 years or less.

Mexico has thousands of miles of pristine sun drenched beach fronts lined with luxury 4 and 5 Star resort hotels as well as an existing major high end international tourist trade. You can count on they are looking for entertainment, something to do besides go to the beach, have dinner and drink Margaritas. We think gaming entertainment has a better than even chance to catch on in Mexico; you can bet the farm on it!