Leading Asian junket investor Suncity Group unveiled plans to further consolidate its market grasp by launching new VIP gambling clubs at the Grand Lisboa Palace and The Londoner Macao. The junket group disclosed it intends to exercise tighter control over its operating expenses. It plans on introducing changes to its workforce in preparation for the launch of the two new VIP clubs on Macau’s Cotai Strip.
Suncity Group stated it has no intentions to lay off staff members for the time being, but did not go into further details on whether it plans to shut down other clubs in the special administrative region. Established in 2007, the group is responsible for the operations of VIP gaming clubs across countries from the Asia-Pacific region like Australia, Vietnam, Macau, and the Philippines.
Suncity unveiled its plans to launch new clubs in the administrative region shortly after the Chinese authorities decided to toughen their restrictions on unauthorized overseas gaming. The country recently amended its gambling legislation, with the changes coming into effect today.
The amendments criminalize individuals who facilitate the organization of illicit overseas gambling activities for residents of mainland China, especially when large amounts of money are involved. The government has given such suspects until the end of April 2021 to confess their crimes and surrender of their own accord. Individuals who expose the gambling crimes of others would face a lighter punishment.
Additionally, the Republic’s Ministry of Culture and Tourism announced in February it intends to add new names to its blacklist of offshore tourist locations said to attract Chinese residents for gambling. There is no information about the new destinations on the list for the time being.
Macau with a Decrease in Licensed Junkets for Eighth Successive Year
According to Steve Vickers, who heads the risk mitigation and consultancy firm Steve Vickers & Associates Limited, the amendments aim to hinder the outflow of capital from mainland China via illegal methods. Junket operators like Suncity should prepare for heavy pressure on behalf of the People’s Republic of China’s government, Mr Vickers warned. In his opinion, the future of junket operators remains unclear in China, although it is still early to write the sector off.
Suncity’s Chief Executive Officer and Chair Alvin Chau described the financial position of the group as “robust” in a press release last summer. The overall fiscal reserve of the company stood at HK$10.58 billion while the funds allocated for the group’s day-to-day operations were estimated at HK$18.6 billion.
Additionally, Suncity had extra capital to the amount of HK$16.5 billion in two local Macau banks at the time of said press release. Official data indicates 2021 is the eighth successive year to see a drop in the number of authorized junkets operating in the special administrative region. In January 2021, Macau reported it had only 85 licensed junkets, compared to the 95 promoters in the same month of 2020.