Valencia Shows Increase in Illegal Gaming
In Valencia, Spain, the local, autonomous government approved a law in 2020 which heavily restricted gambling. It is now seeing the results, which have been, unfortunately for authorities, an increase in illegal gaming since 2020. The sector also lost thousands of jobs due to the closures of once-active gambling spaces. Now the Generalitat Valenciana is grappling with the decisions that led to the creation of Law 1/2020 and its aftermath.
In 2020, Valencia’s government made a drastic gaming decision, but the result has been an increase in illegal gaming.
©Giuseppe Buccola/Unsplash
What did Law 1/2020 stipulate?
Law 1/2020, approved in June 2020 in Valencia, Spain, altered several aspects of the local gaming regulations. For example, an especially high distance — 850 meters — was set as the minimum between gambling spaces and educational facilities.
850 meters might be considered an extreme distance in comparison to regulations in other countries and municipalities. In Catalonia, Spain, the distance is currently set at 100 meters, and, in fact, this distance was not able to be increased in the city of Barcelona because it had already been set by the Generalitat de Catalunya.
This was not the only thing that changed with 2020’s law. In addition, virtually all betting locales did not have their licenses renewed in the aftermath of the law. This measure was taken to combat the proliferation of problem gambling within Valencia at the time. It also resulted in many gaming companies closing down.
Valencia took strong steps in order to fight the issue on its doorstep. Unfortunately, the results have not been what the government expected. Though access to gaming has been restricted, it has not been wiped out. Rather than abide by laws, illegal gambling hotspots have cropped up throughout Valencia.
Since 2020, illegal gambling has seen an increase of 17 percent in the region. Furthermore, an estimated 2,500 jobs were lost as a result of the closure of once-legal gaming spaces, adding to the economic burden already felt in Valencia.
This dichotomy is often exactly what is at the heart of debates over regulated gaming in Spain and throughout Latin America as well. Burgeoning industries, such as those in Central and South America, exist without government oversight as long as gaming is not officially recognized and controlled at the state level.
This leaves players vulnerable; companies — often based off-shore — can offer their services but are difficult to prosecute if they fail to pay up. They also may not abide by any rules set to encourage responsible player behavior. Thus, the problem in Valencia may have gotten worse rather than resolving itself.
This is why many state governments have gradually been coming around to the idea of legalization. Brazil, Peru and Puerto Rico have all voted to make significant changes to gaming laws in the law few months, particularly around legalization of online betting in order to exert more control over consumer safety.
These countries are also implementing safety measures like self-exclusion registries within their new legal frameworks for betting. Furthermore, they will benefit from tax collection as well as local employment increases in some cases.
In Valencia, on the other hand, the gaming law has been compared to prohibition in the US, which saw the illegal alcohol trade dangerously flourish in the early 20th century. Valencia businesses are not happy with the changes and have urged the government to review and consider changing them.
This urging came from SOS Hospitality, a group for freelancers and businesspeople working in the Valencian hospitality sector. They have cited the loss of jobs, both directly and indirectly to do with gaming. They also highlighted that many of these people were aged 50 and above, therefore not in a good position to retrain for new jobs.
The president of SOS Hospitality — or SOS Hostelería as it is known in Spanish — is Fidel Molina. Molina drove the point home with an additional threat not mentioned until now: that as long as the law is not altered, Valencia’s government may also be open to lawsuits from those companies adversely affected by the law.
As was shown in Barcelona’s recent attempt to change distance regulations for gaming spaces and educational locations, Valencia may not have had the right to make such a vast decision. Therefore, Molina argues, it would be best to address this now and to offer more flexibility to those working in the industry.
