The casino licensing process in Chile, now in its final phase, will continue without the participation of Thunderbird Resorts Inc in three more regions. The North American company, with successful casino operations in Costa Rica, Guatemala, Nicaragua, Panama and the Philippines, has been involved in litigation in Chile since its original six applications were ruled out by the licensing authority (SCJ). A Supreme Court ruling at the end of May overturned a unanimous Appeal Court finding in favour of the company and has led to Thunderbird requesting the return of US$6.66 million in bank guarantees.

Originally Thunderbird through its six local subsidiaries applied for casino resort licences in Antofagasta, Rancagua, Talca, Concepcion, Temuco and Algarrobo. On 1 September 2005 the company was informed it had been eliminated from the bidding process for technical reasons the company disputes. In February this year the company decided to drop its applications for Concepcion and Temuco and was returned its US$2.75 million deposits. The SCJ has now announced the return of all Thunderbird deposits with the exception of that made by Thunderbird IEG S.A. when it applied for the Algarrobo licence.

Thunderbird is not the only company to be involved in litigation over the licensing process in Chile. The smooth passage of the new gaming law, which allows for up to 17 new casino licences in Chile’s regions, through the Chilean parliament has not enjoyed a similar path in its enactment. Controversial decisions made by local and regional authorities in awarding points to the various projects have led to parliamentarians considering rewriting the gaming law. Spanish company CIRSA is seeking redress in the courts for the perceived unjust judgment of its projects.

The finding of the Supreme Court for the SCJ and against Thunderbird continues to be questioned. The Director of the project Casino de Algorrobo has said that the decision should be declared void as actually only they had complied with the initial capital requirements for the bidding companies. The decision to exclude Thunderbird “did not only affect the company but affected the people living in the region.”

In 1997 Thunderbird took its first dip into Latin American gaming market waters with a facility in Guatemala. It now has 15 gaming operations in 5 countries, employs over 3,000 Latin Americans and manages more than US$50 million in gaming revenue, offering customers dynamic, themed and integrated venues anchored by casinos. However, in the company’s planned expansion into Chile the odds seem to be stacked against it. (E-06.14.06)

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