Industry experts are discounting a recent report in the Hong Kong Economic Journal that the government of Macau may shorten casino licenses to five to 10 years after they expire beginning in 2020.
Grant Bowie, chief executive of operator MGM China Holdings, described the report as “strange.”
“I think it’s just a misunderstanding yet again,” he said. “When this issue came up last time, under the Macau law the chief executive does have the prerogative to be able to extend any concession, not just gaming concessions, but any concessions for an additional five years. And I would say that he would reserve that prerogative as it applies to gaming concessions. So I think it’s really important that there is no change, nothing is altered.”
Analyst Richard Huang of CLSA Asia Pacific Markets explained that “there is a clause concerning how the licenses will be renewed, which says that if there are no disputes on either side, the licenses can be automatically renewed for the following five years” and that’s what might have triggered the “rumors.”
Secretary of Economy and Finance Francis Tam said the government holds no position on renewal ahead of a review of the six concessions slated to commence in 2015 and 2016.
The Economic Journal cited unidentified sources for its information.
Grant Govertsen of investment brokers Union Gaming Research Macau said he was not concerned, dubbing the report “pure and reckless speculation.”
He said if such a policy was to be implemented it might “discourage investment in Macau.”
