A “fierce” bidding war ahead
With Japan’s Integrated Resorts Implementation Bill now before the Diet, global gaming operators can plan in earnest how they will present their bids for one of three IR licenses in the country.
Though casino gaming was first approved in December 2016, those potential bidders may have to wait until 2019 or even longer to get in the game, said Lawrence Ho, chairman and chief executive of Asian casino developer Melco Resorts and Entertainment Ltd.
“Last week was a big moment in the IR legislation process in Japan, because the parties, the cabinet agreed to submit the bill to the Diet,” Ho said in a May 2 interview with Bloomberg News. But he added that the bidding process may not start until “late next year” at the earliest. Optimists hope the bill will pass during the ongoing parliamentary session, which ends June 20.
Even if that happens, Ho cautioned patience. “They still need time to draft the laws, set up the gaming commission, all the compliance and regulatory areas, and still pick the (host) cities. So I think the soonest that the bidding process can really start is probably end of next year or even 2020.”
Gaming companies will wait it out, he said, because “other than Macau, Japan is the greatest opportunity. That’s why we commit so much effort to it, and we have offices in Tokyo and Osaka.”
The IR Implementation Bill proposes three casino resorts nationwide to start, and a fixed tax rate of 30 percent on gross gaming revenue. It sets a JPY6,000 (US$55) casino entry fee for locals for 24-hour access, and limits casino visits by Japanese to three times a week or a total of 10 times per month. “We haven’t seen anything in the Japanese casino legislation that isn’t manageable,” said Geoffrey Davis, executive vice president and chief financial officer of Melco Resorts and Entertainment Ltd., which has said it’s willing to invest up to $10 billion to get into the market.
Ed Bowers, senior vice president of global gaming development at MGM Resorts International, told the Japan Times he, too is comfortable with the bill. Other would-be contenders include Galaxy Entertainment Group, the Las Vegas Sands Corp., Wynn Resorts, Hard Rock International, Suncity Group and Genting, which foresees a “fierce” battle for the first round of licenses.
Among the cities openly vying for an IR is Osaka. According to GGRAsia, Governor Ichiro Matsui has said a casino resort could open in the prefecture by 2023 if parliament is quick to approve the necessary legislation.
Meanwhile, embattled Prime Minister Shinzo Abe is still talking up the benefits of a casino industry in the country, even as he fends off charges of cronyism in a suspicious land sale. “We will promote tourism with visitors from all over the world spending days at the casino resorts, while taking complete measures to address various concerns including gambling addiction,” Abe said in a recent government meeting.
