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Mexico – Mexico Chamber of Deputies approves lottery merger

By - 23 Octubre 2019

The Plenary of the Chamber of Deputies has approved, with 392 votes in favour, one against and no abstentions, to repeal Mexico’s Lottery Laws and merge La Lotería Nacional para la Asistencia Pública (LOTENAL) with the other state lottery Pronósticos para la Asistencia Pública (Pronósticos).

The opinion, which was sent to the Senate, establishes that the National Lottery will retain its exclusive legal jurisdiction for the purposes of the merger divestment process when it comes to the applicable administrative and budgetary provisions and clarifies that workers’ rights will be respected.

According to the transitory regime Pronósticos will assume the organisation and uninterrupted lottery draws and contests that the National Lottery for Public Assistance made before the entry into force of the decree. The Ministry of Finance and Public Credit (SHCP) will be the coordinating agency which will along with the Ministry of Public Administration take the necessary actions so that human resources are transferred to Pronósticos.

During her presentation, the president of the Government and Population Commission, Rocío Barrera, stressed that after the merger the name of the National Lottery will be maintained.

In July President Andrés Manuel López Obrador confirmed that two of Mexico’s lotteries will merge creating one of the largest lotteries in the region. The sales for Pronósticos are higher and its sales network is much more advanced than LOTENAL, sales for which have been in decline for over ten years.

The merger of both agencies is aimed at reversing LOTENAL’s deficit which was generated from 2008, when the Special Excise Tax on Production and Services (IEPS) was imposed on the lottery. The IEPS tax is imposed on certain products which are deemed harmful in some way to the population or environment such as soft drinks, cigarettes, alcohol and petrol and is already imposed on casinos.

En 2015, la Auditoría General de la República confirmó que LOTENAL se encontraba en un estado de crisis creciente, ya que la lotería había dejado de realizar donaciones a organizaciones benéficas públicas y dependía del dinero del gobierno para mantenerse a flote e incluso pagar premios en algunos casos. Como resultado, la Oficina de Auditoría recomendó al poder ejecutivo disolver la lotería por completo porque no había cumplido con su mandato de recaudar dinero para causas benéficas.

Sin embargo, el gobierno lleva algún tiempo buscando otra solución y, en lugar de eliminar la lotería por completo, ha estado estudiando la viabilidad de fusionar eventualmente LOTENAL con Pronósticos.

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