The ban on the promotion of sports betting or forecasts is not in the Organic Law on Communications, but was added to its regulation

Companies dedicated to collecting and paying prizes to those who are correct in sports predictions promote their activity during football matches broadcast on a pay television channel (GolTV) and on social networks.

They even finance some Liga Pro football teams, which is why EcuaBet and BET593, for example, appear on the players’ shirts.

They are also mentioned by radio and television commentators, because there are advertisements for them in sports programs that are broadcast digitally and on the channel GolTV. As part of the promotional strategy, they appear on the LED screens lining the playing fields in the stadiums.

Online sports betting is taking off in Ecuador without being regulated by law

There was no ban until the President of the Republic, Guillermo Lasso, issued the Organic Law on Communication (LOC) on August 23, which in its art. 56 prohibits “advertising or promotion of child pornography, cigarettes, controlled substances and all types of betting systems and sports predictions”.

The problem is that the ban on the promotion of sports predictions or betting is not included in the LOC that has been in force since June 2013 and approved during the correísmo, constitutionalist Aldrin Gómez points out.

“He regulation of the outgoing President of the Republic (in Executive Decree 853) it is unconstitutional. First, that the ZOO does not set any restrictions regarding the advertising of sports forecasts, so the rules of the Organic Law on Communications are changed and innovated. The Constitutional Court (US) condemns regulations that in theory must develop legal norms, but cannot change, innovate, or contradict them“.

Gomez claims it is President Lasso’s regulation violates the principle of reservation of rights. “The Constitution says that when people’s rights are regulated, it must be done by a norm with the force of law, which is not a regulation. In this case, the exercise of the right to perform economic activity is limited”.

Who The LOC prohibits the promotion of alcoholic beverages in generalTherefore, they are no longer mentioned in the media or on a commercial network, but their advertisements appear in stadiums and they can also sponsor teams.

“The restriction of activities that many people live on is not only the teams, which, given persistent intrigues such as the one that they can no longer use the advertisements of matches that were broadcast on national channels, have had to find a way to generate income. The treasury is not enough to cover the expenses they have, among which are salaries, bonuses, not only for the players, there are a number of people behind the football industry,” notes Gómez.

In addition to the provisions of the Law on Communications, there are tight deadlines for the formation of institutions that will coincide with the change of Government

The following teams in the A Pro League series are sponsored by bookmakers that are already based in Ecuador and pay taxes to the state treasury through the Tax Administration (SRI).

They are Barcelona SC (Betano), Emelec (Novibet), Guayaquil City (Bet593), Orense (Betcris), Aucas (Bet593), El Nacional (GanaPlay Ecuador), Liga de Quito (Ecuabet), Independiente del Valle (Ecuabet) and Mushuc Rune (Ekvabet).

“The magnitude of this regulation banning the promotion of sports predictions has not been taken into account.”

Some of these sponsorships include promoting activities during matches.

Liga Pro rejects government regulations and warns of “legal action”

In Ecuador, a tax is charged for the prohibited activity

Games of chance involving betting were banned in the country in a 2011 referendum, but that doesn’t mean it’s respected, Gómez says, and that people don’t do it anymore.

Gambling was declared illegal after a referendum on May 7, 2011, during the correísma, which led to the definitive closure of the casino. But police operatives realize that the game was going on secretly.

“What was done in the case of sports forecasts was that they operated through platforms that are outside the country, like Colombia, Mexico and the United States, that was a pretty ingenious way to avoid the ban.” This is possible through virtual portals (internet).

“Unfortunately, the legal system does not keep up with the progress of society and its technologies,” adds Gómez.

In countries like Colombia, social policy is financed from what is collected from these betting shops, the expert adds.

In fact, SRI already charges profit tax to companies that are engaged in betting on sports forecasts.

And from January 2024, all sports forecast operators must pay a single tax, as determined by the Organic Law for Strengthening the Family Economy, which is passed by the Executive Power and approved by the CC.

This includes those who do not reside in Ecuador but work through the web.

This rule indicates that national sports prediction companies will pay 15% per month on the net income they receive.

According to Gómez, the unconstitutionality of the regulation could be sued before the Constitutional Court. “In that case, you don’t have to have a direct interest in what’s being asked for.”

However, the illegality of the regulations could be initiated before the Administrative Civil Court only by the actors involved in it: “When the illegality of these so-called objective actions is sought, there is a slightly more complex limitation on who can sue. It must be shown that there is a direct legitimate interest”.

Questions and answers Elections 2023