In a landmark judicial victory for Mexico’s gaming industry, the country’s Supreme Court has agreed to review two lower court decisions that have allowed for casinos to expand operations with more slot machines and other casino games such as roulette, dice, and cards. The move, initiated by the Ministry of the Interior (Segob), is in line with ongoing legal and regulatory uncertainty in the Mexican gaming sector following a controversial 2023 regulation overhaul.
Background: A Challenge to the 2023 Reform
The court battle is over the 2023 modification of Mexico’s flagship gaming law, the Reglamento de la Ley Federal de Juegos y Sorteos (LFJS), signed by former President Andrés Manuel López Obrador. The reform sought to restrict a number of gaming modalities, particularly table games, by narrowing the regulatory definition of a “game of chance.”
Grupo Caliente, one of the country’s largest gaming operators, and Sabia Corporation, a gaming technology firm, prevailed in their lawsuit against the reform in lower courts via judicial amparos (constitutional injunctions), arguing that the reforms violated the LFJS, a federal law passed in 1947. Lower courts agreed, permitting them to continue and pursue their businesses.
Supreme Court Steps In
The Ministry of the Interior requested that the Supreme Court review these rulings, and on May 28 in a closed session, the Court’s Second Chamber granted the request for review by a vote of 3–1. Justice Yasmín Esquivel officially assumed the request in spite of questions of Segob’s legal jurisdiction to appeal.
The First Chamber of the Court had already dismissed a similar appeal last March. Nevertheless, with the Second Chamber’s acceptance, the case will be further examined. However, with barely any more sessions left and a new composition of the judges set to take office next September, the whole nine-member Supreme Court (sitting en banc) will most likely hear the case later this year.
Legal Arguments: Skill or Luck Games
At the heart of the legal argument is the definition of a “sorteo” (game of chance). The LFJS allows “games and raffles,” but lacks explicit language encompassing most modern types of gaming, which leads to different interpretations.
Since 2016, the Supreme Court has already acknowledged that slot machines, or “number draw machines,” are covered by the LFJS. The reform in 2023, however, aimed to stop the proliferation of table games by denying them the regulatory definition of approved games of chance.
Lower courts ruled in favor of the operators, holding that games of roulette, dice, and cards are core to being similar to raffles in their outcomes, relying primarily on chance rather than skill. Dice, as one example, were specifically addressed in the first LFJS, creating more judicial precedent.
Companies Involved and Precedent Set
A few of these have already received solid, irrevocable amparos protecting their expanded operations. Some of the major casino operators already have these, including AEV, EDOSA, and EFM, which together operate about 50 gaming houses throughout the country.
The experts point out that even with any possible ruling by the Supreme Court against the current interpretation, the amparos granted so far may be exempted, such that only a small number of operators would be assured extended gaming rights.
Political and Regulatory Outlook
The incoming administration of President-elect Claudia Sheinbaum has signaled that it wants to overhaul the country’s gambling law. The outgoing Segob head, Rosa Icela Rodríguez, has stated she supports drawing up a comprehensive new legal code. But action in Congress is stalled, and so it has left the judiciary to fill crucial gaps in enforcement and interpretation.
As the Second Chamber prepares to change and the Supreme Court prepares to rebalance in a more general way this fall, the fate of the regulation of gaming in Mexico remains uncertain. Legal clarification of what constitutes an acceptable game under the LFJS should create major precedent for operators as well as for the role of executive regulations in shaping the industry.
Ultimately, the Court decision can affect what future reforms are drafted and enacted, and to what degree, with investment, compliance, and Mexico’s regulated gambling market’s growth path at stake.
