Company: RSI
Filing Date: 2025-02-18
Form Type: 8-K
Source: 0001793659-25-000035
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Company: Rush Street Interactive, Inc.
Filing Date: 2025-02-18
Form: 8-K
Item: Item 8.01
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Item 8.01 Other Events.

On January 24, 2025, Colombian President Gustavo Petro, citing violence in the Republic of Colombia’s Catatumbo region near the Venezuelan border, declared a state of internal commotion (state of emergency) decree, granting him emergency powers to, among other things, issue financial decrees aimed at addressing the crisis while bypassing the standard framework of obtaining approval by the Colombian legislature. On February 14, 2025, in support of his internal commotion decree, Colombian President Petro issued a temporary decree imposing a 19% Value-Added Tax (VAT) to be collected on player deposits made in the country with operators of games of chance and luck operated over the Internet (the “ Decree”). Under applicable Colombian law, these Presidential Decrees are subject to automatic review by the Constitutional Court of Colombia (which is independent of the President and the executive branch) to determine if they are constitutional and properly issued. Certain prior such Presidential decrees have been found unconstitutional by the Constitutional Court.

If the decrees are found constitutional, it is expected that the VAT may last up until December 31, 2025, subject to determination by the Constitutional Court to limit it to no more than 180 days. If the internal commotion decree is found unconstitutional, then the Decree becomes moot and without further effect. Rush Street Interactive, Inc. (the “ Company”), which has real-money gaming operations in Colombia, is currently evaluating the Decree and its potential impacts on the Company’s Colombian operations and financial results. Among other things, the Decree could decrease customer demand for regulated and taxed real-money online gaming services and decrease the Company’s revenue in Colombia. Currently, the Company’s Colombian operations comprise approximately 13.3% of the Company’s overall revenue.

The Company will continue to analyze the potential effects of the Decree on its financial statements and operations. While the constitutionality, timing and impact of the Decree is unknown at this time, and any assessment of the impact to the Company of the various possible Decree scenarios remains speculative, the Company is actively anticipating certain actions that may, among other things, help reduce operating and marketing expenses to partially offset potential future impacts on the Company’s revenue.

Management remains focused on creating long-term value for the Company’s stockholders, which includes continuing to grow its Colombian business. Despite the potential short-term challenges posed by the Decree, the Company believes that its operational expertise, experienced management team and local resources, will enable it to continue to achieve