(AsiaGameHub) –   A judicial decision in Puerto Rico has supported businesses advocating for the reinstatement of a clear and competitive system for the distribution and licensing of gaming machines.

The San Juan Court of Appeals has determined that the existing inconsistencies within Puerto Rico’s laws concerning “MAJAR” gaming machines, which are installed in bars, shops, and smaller establishments, are no longer valid.

Consequently, the Puerto Rico Gaming Commission (PRGC) is now required to re-establish a licensing application and regulatory framework for companies interested in providing MAJAR gaming machines.

The PRGC will be responsible for overseeing and enforcing regulations pertaining to Puerto Rico’s casino sector, gaming halls, sports betting franchises, gaming machine distribution, and horse racing.

Regulations for individual gambling disciplines will continue to be managed under separate legislative acts, as Puerto Rico has not yet developed a comprehensive, unified charter to govern its entire gambling industry.

In 2024/2025, thirty local businesses filed an appeal in San Jose, challenging the PRGC’s justifications for denying their venues the ability to process gaming machine licenses under the new regulatory framework introduced by Regulation 9647.

The San Jose ruling concluded that the PRGC could not indefinitely postpone or reject the processing of applications while simultaneously imposing new compliance requirements on operators.

The court affirmed that businesses possessed the right to pursue licenses under the prevailing legal framework and that the regulatory body was obligated to create a functional “administrative pathway for applications to be reviewed and adjudicated.”

Patchwork rules and statutes

Patchwork rules and statutes

This legal dispute has highlighted the fragmented nature of Puerto Rico’s gambling legislation, where various forms of gambling, including casino gaming, sports betting, route gaming machines, and online wagering, are governed by a collection of disparate statutes and administrative regulations rather than a single, consolidated gambling code.

At the core of this controversy are MAJAR machines, which are slot-style gaming terminals typically found outside of casinos in authorized locations such as bars, restaurants, and convenience stores.

For an extended period, the market operated in a largely unregulated environment, with thousands of machines distributed across the island under inconsistent supervision.

Puerto Rican authorities aimed to modernize the system through Regulation 9647, which was approved in January 2025 by the Financial Oversight and Management Board. This new framework mandated individual licensing for each machine, required visible registration tags, implemented digital monitoring systems, and stipulated that all machines must connect to a centralized technological platform managed by the regulator.

The PRGC officially launched the interconnection program in January 2026, providing operators with a 90-day window to demonstrate that they had secured contracts with certified technology providers capable of linking their machines to the government’s monitoring network.

Regulators contended that these reforms were essential for improving tax collection, enhancing operational transparency, and combating illegal gambling activities, which remain prevalent throughout Puerto Rico.

Industry estimates continue to indicate that unlicensed operators hold a significant majority of the gaming machine and online gambling market share on the island.

Operators, however, alleged that the regulator was applying the rules selectively and obstructing legitimate businesses from entering the legal market.

The recent court ruling now compels the PRGC to process applications and reopen the licensing process for operators seeking to formalize their businesses under the new regulatory framework.

This case has considerable implications for Puerto Rico’s broader gambling industry. The revenue generated from machine licensing and oversight plays a crucial role in public finances, including funding allocated to the Puerto Rico Police Retirement System.