Chile's ban on sports betting leads to fewer sponsors for soccer teams.
Last week, judges on Chile's highest court decided that most sports betting platforms functioning in the country are ostensibly breaking the law. Predicted to have a substantial influence on Chile's sports sector, particularly its soccer industry, teams have already shattered their sponsorship contracts with the sportsbooks.
In a 5-0 decision, the Supreme Court hammered a devastating blow to online betting companies and soccer. Many of these companies sponsor local soccer teams and the principal national championship. However, the only organization that managed to escape legal scrutiny was the government-managed gaming and lottery agency, La Polla Chilena de Beneficencia.
Betsson and Betway, two significant operators, are suspected to suffer the most from the verdict. Betsson has invested substantial funds in Chilean soccer and Betway served as the sole sponsor for numerous local teams. Consequently, both platforms have been removed from the championship.
Betsson Forfeits Significant Investment
The news about the outlawing of sports betting spread expeditiously, even reaching Malta and Sweden – where Betsson's operations and stakeholders reside. Betsson had paid $2.5 million to the National Professional Football Association (ANFP) to acquire its spot, subsequently upping its stake to $8 million. Their previous sponsor, AFP Planvital, funded the same privilege but at a cost of $500K.
Since the beginning of the year, Betsson has endorsed Boca Juniors in Argentina under a $7.5 million contract. They also endorse teams in other nations such as Spain and Peru and are the title sponsor of the Brazilian League 1. Additionally, they sponsored the 2021 Copa America tournament.
The arrangement with the highest Chilean football authority had already been waning before the Supreme Court rendered its ruling. On August 31, the Undersecretariat of Justice commanded the ANFP to revoke any contract that tied the association with Betsson within 30 business days. Additionally, the ANFP needed to eliminate any mention of the company on its website and all other public media, as well as rename its First Division A and B championships.
The ANFP fiercely challenged this directive and employed a lawyer to lodge an appeal against the order. Nonetheless, when the Supreme Court entered the fray, everything ground to a halt, and the ANFP is now ripping up its partnership with Betsson.
Betway Steps Aside
Almost all local soccer outfits have an online betting operator emblazoned on their jerseys, all of which have been ruled illegal by the Supreme Court. If any team persists in maintaining the contract, they risk facing legal and monetary issues.
According to a local media outlet, El Mercurio, five teams, Unión La Calera, Everton de Viña del Mar, Ǹublense, Audax Italiano, and Coquimbo Unidos, will end their association with Betway. They were the first to announce their commitments during a collective ceremony in January 2022. Other squads have subsequently followed suit, with Unión Española the sole National Championship team without a betting platform as a sponsor.
1190 Sports, the sports rights administration firm linking the teams with Betway, instructed them to discontinue their partnership. They'll reportedly conclude their separation in the following days having contacted Betway for a discussion on the prospective aftermath.
Total value data for the combined sponsorships is scant, and it remains unclear how much Betway has already delivered. Each arrangement, incorporating Betsson's, must be individually assessed to determine financial obligations and reimbursements, if applicable.
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