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NEWS 13 May 2019

Macau casino licenses: Government remains a closed book

By Nathan Joyes

Macau's current laws state casino concessions are offered maximum 20-year terms, with the possibility of a five-year renewal if approved by the city.

Under current law, new concessions can only be issued following a complete bidding process, as if it was the first time casinos launched in Macau.

Despite interest from other operators, Macau chose to extend its casino licenses for operators MGM China and SJM Holdings in March until 2022. Sands China, Wynn Macau, Galaxy Entertainment and Melco Resorts & Entertainment will all need to rebid if they want their licenses renewed further, which are due to expire in June 2022.

Casino licenses and their processes remain controversial to this day, as such little information about how the winning operators are chosen is made public.

Visiting Professor of Gaming Law and Anti-Money Laundering Law at the University of Macau, Jorge Godinho, wants to see more innovation from Macau's government.

He tells Gambling Insider: "Macau is in an area where there is a very high propensity for gambling, which will surely continue to mean we have quite a profitable industry. However, I would like to see Macau having intellectual leadership and fresh ideas; not just strong revenue."

SJM Holdings, which formerly operated the market in a monopoly before it was opened to foreign operators, signed its first contract with Macau in the expanded market in 2002. This concession was given for a period of 18 years, whereas all other operators agreed to a 20-year deal. SJM never explained to the public why this was the case.

The International Monetary Fund (IMF) was one of the first to voice its concerns over the silence.

The organisation said: "The authorities have the opportunity to further advance their growth strategy and should craft the new regulations with stronger incentives for operators to expand non-VIP tourism."

Changbin Wang, Director at Macau Polytechnic Institute, explained why the government remained quiet over MGM and SJM's recent extensions to continue operating in Macau.

He said: "The government was not willing to open to the public while the negotiation for the conditions and terms of renewal were still ongoing. The extension has not gone against expectation, although we did not know the specific conditions."

Godinho and Wang were speaking exclusively for a feature in the May/June edition of the Gambling Insider magazine. Register for free here to read the full article now.

 

RELATED TAGS: Land-Based | Industry | Mergers & Acquisitions | Legal & Regulatory | Casino
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