On the occasion of External Circular No. 20191000000066 emanating from the office of the Presidency of Coljuegos, in which the localized gaming sector is informed of the interpretation that was made institutionally of article 59 of the National Development Plan -PND- (Law 1955 of 2019 ), and how it will be applied in relation to the formula for calculating operating rights and administrative expenses as of May 25, 2019, date on which the aforementioned Law was promulgated.

Many operators have thought about terminating their concession contracts in advance in order to start new contracts, with the idea that the new exploitation rights rates will apply for contracts signed after the PND publication date, based on the idea that remained in the air when Coljuegos expressed what concerns the principle of irretroactivity of the norm.

In other words, the feeling that Coljuegos left in a sector of the operators with the External Circular is that what was established in the PND would be applied for contracts signed after May 25, 2019.

Although from my point of view, this interpretation given by the entity is erroneous, since in tax law the principle of irretroactivity of the law is not absolute, since it must be harmonized with that of favorability; It is a lesser evil when compared to what was stated in terms of reliability.

Thus, the External Circular basically states that the other reason for not applying the PND is the lack of reliability in the processing of data transmitted to calculate the payment of exploitation rights. And this happens since Coljuegos has not yet issued norms that parameterize minimum standards to determine whether the transmission of data by operators is reliable or not.

If I can make a colloquial comparison, Coljuegos acts as the young and capricious wife who reprimands her selfless husband every Sunday for not washing the family car, knowing that even the couple has not bought a car yet.

In the same way the entity requires for the application of the PND that supposed conditions of reliability are met that are non-existent in the current legal system.

In that order of ideas, what was initially seen as a relief, due to the drop in fees that promulgated article 59 of the PND, has become a headache for operators on account of the interpretation so particular that Coljuegos He gave the rule, in the sense that it does not apply to contracts signed before May 25 of the currents due to the principle of non-retroactivity of the Law, but neither does it apply to contracts subsequently signed for issues of transmission reliability.

As regards, I think that the idea of some operators to terminate contracts in full execution to start new contracts is inconvenient, considering that they will not be able to apply what is established in the PND, and on the contrary they will generate administrative wear and financial to their societies.

This in broad strokes is the panorama we have today regarding the application of the PND and the External Circular issued by Coljuegos.

We know that the unions and some operators individually are taking administrative and judicial actions to achieve a favorable exit for all parties; We trust that this will happen as soon as possible.

* César Emilio Pacho Algarra is Legal Director of TECNASEG insurance placement agency specialized in compliance policies for games of chance and chance PBX (1) 236 3645-236 0834