Basically, yeah... forever.
The following applies to chat everywhere on this site, in both private games and public rooms (the forum, tournament chats, etc). This comic is a good representation of free speech on the Internet: https://xkcd.com/1357/
A user who is banned from chatting is able to communicate (chat and private message) their followers.
For example: if someone loses their game and says "fuck"... that's fine. Even stuff like "you suck" is acceptable (to me, at least). Horrible sportsmanship to say that, but it's not a comment that someone should take to heart.
However, abusive comments that aim to insult people and make them, for the lack of a better word, uncomfortable, are not tolerated. Also, harassment, threats, spamming (flooding), racism and sexual insults (especially) are also not allowed.
An example of such behaviour would be cursing at every player that beats them, insulting them by saying "[bad work] your [bad word] mother's [bad word] and I'll [bad word] your [bad word] [bad word] [bad word] kid [bad word] with my [bad word]" is stupid, immature, not permitted, and would result in a ban from the chats/forums.
Moderators use their judgement for determining how bad the reported user's infraction is.