UNLV weighs in on Japan's casino industry

University of Las Vegas’ International Gaming Institute has published two research reports on the nascent Japanese casino industry.

Its first report, the 100-page “Socio-Economic Impacts of Japanese Integrated Resorts” publication analyses the impact of an integrated resort casino, with a particular focus on Japan’s goals for the project which include encouraging the Japanese tourism market whilst also minimising gambling addiction and related crime.

Researchers from UNLV state that “Japan is in a fortunate position. There are many jurisdictions that have developed large IR projects and can serve as case studies for appropriate policies. The science behind socio-economic impacts of casino IRs has also improved significantly in the past 15 years, providing practical guidelines for many decisions.”

It later goes on to add that “The addition of a major tourism-oriented IR development would complement this existing economy and infrastructure with some significant socio-economic advantages.

“In fact, of all of the ways in which the gambling act can be commercialised, this type of IR achieves the tourism metrics sought by Japan (outlined in the above section) best. Crucially, policymakers have a significant opportunity at this stage to positively impact how the IRs contribute to these desired goals.”

The second report, “Practical Perspectives on Gambling Regulatory Processes for Study by Japan: Eliminating Organised Crime in Nevada Casinos” illustrates how gaming regulation can help Japan to eliminate organised crime in the casino industry, suggesting the introduction of a rigorous licensing regime with internal controls and compliance practices.

Using regulation in Nevada as its comparison model, the report suggests pre-licensing background investigations and post-licensing enforcement structures designed with the objective of stopping criminal organisations from infiltrating the Japanese casino industry.

The report concludes that “embracing this regulatory approach to prevention and/or elimination of organised crime will be especially crucial for a number of reasons.

“First, the global gaming industry (as well as the general public) is well aware that the Yakuza have been active in gambling activities in Japan, which mandates an aggressive approach.

“Second, for Japan to attract the desired and desirable kind of globally-competitive capital investment in its integrated resorts, which will in turn allow for the desired and desirable kinds of globally-competitive integrated resort destinations to be constructed, there can be no association with organised crime at all – the banks, the investment community, and the most respected casino operators simply will not (indeed, cannot) participate.”

The Japanese Diet is expected to agree the countries regulatory framework for gambling next year, with the first integrated resorts expected to open in the early 2020s.