Saipan’s top casino regulator has declared that a move to revoke an exclusive gaming license held by Imperial Pacific International (IPI) would be unconstitutional. IPI’s casino opened in 2015 on Saipan, in the Commonwealth of the Northern Mariana Islands (CNMI) in the western Pacific.
Initially, the VIP property generated Macau-worthy revenues, even in a temporary locale at a Garapan shopping mall. It moved to a permanent location in 2018. But the operation soon fell into disarray, in part due to uncollectable VIP debts.
According to Marianas Variety, Andrew Yeom, executive director of the Commonwealth Casino Commission, told a House Committee last week that a bill to award five casino licenses on Saipan would violate the constitution because an exclusive license had already been established.
“We cannot have a local bill trying to supersede a commonwealth law,” Yeom said. Inside Asian Gaming reports that it was Yeom himself who called for IPI’s license suspension after the operator failed to comply with the terms of its license.
Yeom filed five complaints against IPI last year when the operator failed to pay an annual $15.5 million license fee and $3.1 million regulatory fee. In 2018 and 2019, it failed to contribute $20 million to the community benefit fund. In addition, IPI did not meet its minimum $2 billion capital requirement and did not pay all the money owed to its vendors. The company’s license was suspended last April.
A House bill filed in November called for an end to IPI’s exclusivity, stating, “The present situation, where the exclusive casino licensee has not been able to pay taxes and, most relevantly, cannot reliably pay the $15 million guaranteed license fee, demonstrates that it was imprudent for the commonwealth to rely on just one industry and just one company.”
To “obtain the goal of increased stability and dependability … We must move away from the current single licensee framework that is totally dependent on one business entity.”
IPI has previously said it would “vigorously defend” its exclusive Saipan casino license.
In a column on the subject in Asia Gaming Brief, analyst Brendan Bussmann of Global Market Advisors said Saipan has “strong potential as a gaming outpost in the Pacific, however, stakeholders need to take decisive action to improve regulation and find a suitable operator.”
Those stakeholders “have to decide if they want to take a serious look at reform and how to erase the challenges that IPI has presented to them,” Bussmann said.
The CNMI is a U.S.-controlled territory.
