On January 18th, the Legislative Assembly of Macau published the draft bill called “Amendment to Law No. 16/2001 – Legal framework to the exploitation of games of chance in casinos”. The proposed changes, which would have to be approved by the local Legislature before being turned into law, mark the most serious reform brought to the gambling regulations in the world’s largest hub.
The move comes ahead of the renewal of the bidding process for the six casino operating licenses in the special administrative region. Also, the Legislative Assembly published the draft bill only days after the Government lifted the curtain on a number of key issues, including the number of concessions that would be granted by the authorities after the current casino permits expire in June 2022, as well as the duration of the new casino licenses. As CasinoGamesPro already reported, Macau officials at the time confirmed that up to six casino operating permits would be granted for a period of 10 years with the possibility of a 3-year extension of the license in case of exceptional circumstances.
The draft bill was published in both Traditional Chinese and Portuguese. It provides more details about the regulation of the local gambling industry, including some new rules regarding controversial junket operators. Last Friday, when the Government shared some details about the considered changes, it became clear that the new gaming law amendments would seek to suspend so-called VIP junket rooms in the special administrative region-based casinos and revenue share agreements between casino and junket operators.
The proposed piece of legislation aims at providing more clarity on the role of junket operators that have been operating in Macau for years, acting as intermediaries who have been tasked with attracting high-roller gamblers from mainland China to Macau. If the draft bill is signed into law, casino operators in the special administrative region would no longer be allowed to feature so-called dedicated junket rooms. Revenue-sharing agreements between casino and junket operators would also be banned.
As it became clear from the wording of the draft bill, Macau authorities will continue to issue so-called junket licenses to approved promoters of VIP gambling services. Their operations, however, would be restricted to one concessionaire only.
Government of Mainland China Seeks Tighter Control on Macau’s Casino Sector
For a few years, the Chinese Central Government has become extremely concerned about how dependent is Macau on gambling. The newly-published draft bill, however, has not yet provided any details on how the authorities will conduct the license rebidding process. Still, the Government has made it very clear that it wants tighter control over the activities of Macau’s casino operators, with both Beijing and the special administrative region tightening the scrutiny of casino companies in the last few years by restricting illegal capital flows from the mainland. The Chinese Government also has the right to terminate casino permits for various reasons, including breaching the operating license conditions or public interest.
Although the authorities have so far rejected a proposal for the establishment of a special casino supervisor following some feedback from gambling companies that operate in the special administrative region, casinos will still be subject to a thorough review every three years, with the Macau gambling regulatory body set to check whether they are generally compliant with their license provisions.
Each holder of a casino operating license will have a 30% limit on the number of shares that can be publicly listed. Casino companies will also be required to inform the authorities about any major financial transactions. Under the provisions of the proposed piece of legislation, they will also be required to draw up a plan for responsible gambling promotion, while a maximum number of gambling machines and gambling tables will be set for each license holder.
To earn the authorities’ favor, Macau casino operators have tried to diversify their services into non-gaming services and to enhance their corporate responsibility.