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Imperial Pacific Has to Pay Gaming License Fee or Will Lose Its Operating License, CNMI Governor Warns

Saipan casino company Imperial Pacific International (IPI) has received official notice that it will either pay the fee for its gaming license or will no longer hold such a license.

Yesterday, Ralph Torress, the Governor of the Commonwealth of the Northern Mariana Islands (CNMI), addressed the boss of Imperial Pacific International, informing him that the operator’s gaming license would be revoked or suspended unless the company paid the required annual license fee of $15.5 million. Mr. Torres also informed IPI’s CEO that the company will have to make a $3-million contribution to the Community Benefit Fund.

In a letter, CEO Donald Browne was informed that the Governor rejected a request filed by the Saipan casino company for its required license fee to be removed. Governor Torres wrote that local authorities were unable to deal with the operator’s request administratively, as the fee has been set by law, which made it unconditional.

Mr. Torres explained that the license fee in question is created under Commonwealth Law, and the Force Majeure clause of the gambling company’s license agreement could not supplant a statutory command of the Legislature. The same applies to the payment of the operator’s Casino License fee. Browne, who took over the CEO position less than a month ago, has claimed that international travel restrictions imposed because of the coronavirus outbreak are a “force majeure”, which should be enough to allow Imperial Pacific to postpone payment of its license fee.

Saipan Casino Operator Faces Financial Struggles Due to Negative Coronavirus Lockdown Impact

A week ago, Imperial Pacific requested the license fee abatement, along with postponement of the $3-million regulatory fee owed to the Community Benefit Fund, because of the negative impact that the coronavirus pandemic had on its operations. The Covid-19 outbreak has seen casino companies closed since March 2020, which seriously affected the viability of operators’ businesses and their financial state.

Imperial Pacific has been struggling financially for years, with the financial troubles of the company being followed by lawsuits filed by unpaid contractors. The company also wanted to know whether it owes the CNMI government unpaid Benefit Fund payments estimated at $37 million. The Saipan casino operator made a long pause before paying its 2019 license fee to the government and last week said that the authorities have broken their promise to allow it to pay its 2020 license fee by the deadline on August 12th.

Late in July, the Commonwealth Casino Commission’s (CCC) Chairman warned Mr. Browne that Imperial Pacific was supposed to pay its license fee on time and that was an issue that would not be subject to further negotiations.

Now, apart from explaining that the so-called force majeure clause of the company’s license agreement cannot annul an explicit statutory command of the Legislature, Mr. Torres also informed that the failure of Imperial Pacific to make its payment to the Community Benefit Fund constituted a material breach of its operating license. He further explained that his letter would serve as “notice of intent” that the Commonwealth Casino Commission was ready to suspend or revoke the company’s license in case the operator does not make a payment as soon as possible.

 Author: Harrison Young

Harrison Young is an experienced writer, who started his career almost 8 years ago. Prior to joining our team at CasinoGamesPro, he worked as an editor for a small magazine.