Macau’s amended gaming laws were enacted July 2, under an especially unwieldy official name: “Amendments to the Executive Regulations Regulating the Public Tender for the Attribution of Concessions for the Operation of Games of Chance in Casinos, the Concession Contract and the Requirements of Suitability and Financial Capacity of Competitors and Concessionaires.”
Now gaming operators in the Chinese special administrative district (SAR) can rev up their efforts to win new concessions, a process that should be complete by the end of the year.
As reported by Asia Gaming Brief, though the tender guidelines have been published, the “broad-brush outline” is still “short on specifics.”
Among other things, the new tender requires that gaming companies share how they will attract more “foreign tourists”; they will win extra points and tax incentives for drawing travelers beyond Mainland China. This follows the May declaration by Chan Chak Mo, chairman of the legislative committee evaluating the amendments, that the city has to diversify its tourism base due to China’s ongoing crackdown on cross-border gambling.
Operators also must detail their experience operating casino games; provide investment plans for gaming and non-gaming projects in the SAR; and lay out their planned corporate social responsibility (CSR) policies. In addition, bidders must propose a minimum number of gaming tables and machines that it plans to operate within the 10-year concession term; present plans on casino management; and share how they will conduct surveillance and otherwise prevent illicit activities in casinos.
Upon securing a concession, licensees must prove that they have at least MOP5 billion (US$618 million) in capital on hand, deposited in local credit institutions.
Only six licenses will be granted, but the government may solicit up to eight bids. That said, analysts at J.P. Morgan still expect that the six incumbent operators will be reinstated.
The current 20-year concessions all expired at the end of June, but the government extended the process by six months to allow more time for the retender. All six operators—Wynn Macau, Sands China, Melco, SJM Holdings, Galaxy and MGM China—were required to pay $6 million for the extension.
Ben Lee, managing partner of IGamiX Management & Consulting, told AGB the tender rules are light on detail and “don’t leave us any the wiser.” For example, operators still don’t know the minimum amount they must invest in non-gaming amenities or the overall investment level, for that matter.
Meanwhile, Inside Asian Gaming reports that the Macau Gaming Inspection and Coordination Bureau (DICJ) met with the Big 6 concessionaires on June 30 and asked them to dramatically reduce casino operations, sending a majority of gaming employees home and limiting the number of open gaming tables to 10 or less. Tourism has come to a standstill due to a recent outbreak of Covid-19, with more than 1,100 people infected.
