Costa Rica’s Gambling Blind Spot Leaves Half the Market in Illegal Hands

Costa Rica’s lawmakers are again confronting a problem they have managed around for years: more than half of the country’s lottery and betting activity is now estimated to be controlled by illegal operators.

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The figure presented to President Laura Fernández Delgado’s new administration is blunt. Illegal gambling groups are believed to represent 53% of the market, draining roughly $300 million a year from the economy while operating through gaps in laws that were never designed for the online betting era.

Costa Rica has no dedicated online gambling licensing system. It also lacks a central gambling regulator. For years, offshore-facing operators could set up companies under ordinary commercial rules, as long as they did not target local players or interfere with the Junta de Protección Social’s state lottery monopoly.

That arrangement is now being treated in San José less as a workaround and more as a liability.

Lawmakers have revived reform through legislative file 25.600, aimed at strengthening and modernising the JPS. Vice President of the Legislative Assembly Esmeralda Britton has positioned the bill as a way to protect public funds that support social programmes, while closing space for criminal networks and unlicensed platforms.

A Regulatory System Built for a Different Era

The proposal goes beyond simple enforcement. It would introduce real-time monitoring of gambling activity, software audits, certification of algorithms, broader transparency requirements and stronger supervision of digital betting operations.

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The plan also links gambling oversight more closely with Costa Rica’s financial crime apparatus. The JPS would work more deeply with the Financial Intelligence Unit, the Costa Rican Drug Institute and CONASSIF, bringing gambling-related financial activity into sharper view.

Inside the JPS, frustration has been building for some time. Officials have warned that outdated rules allow illegal platforms to avoid taxes, evade controls, expose minors, and divert money away from social causes. They have also pointed to the risk that gambling flows can be used by criminal structures.

The renewed push follows the failure of an earlier reform effort, Bill 25.057, which advanced in late 2025 but was rejected in early 2026.

Now the pressure lands on Fernández Delgado, who took office on 8 May after campaigning on crime. The debate has reopened, but there is still no clear timetable for new enforcement powers, institutional changes or supervisory systems.

Costa Rica remains an outlier in Central America: a gambling market without a dedicated authority, trying to police digital betting with a framework built for another age.

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