Only eight VIP junkets are currently operating in Macau, where high-roller gaming once ruled, even though the local government issued 36 junket licenses in January.
Macau’s new gaming law, which took effect January 1, bars the once-mighty junkets from running their own VIP rooms in the city’s casinos. In terms of earning, it also limits them to commissions from rolling chip turnover and prohibits revenue-sharing agreements. Furthermore, it restricts them to doing business with a single concessionaire.
U Io Hung, president of the Macau Professional Association of Gaming Promoters, told Inside Asian Gaming that some licensed operators have yet to sign their new concessionaire agreements, while others are still preparing to launch. And only three of the city’s six concessionaires now have junket agreements in place, he added.
The newly-formed trade group already has 50 industry members, U said, including 11 licensed junkets. The sector took a hit due to China’s crackdown on illegal gambling, capped by the arrests of two industry bosses—Alvin Chau of the Suncity Group, and Levo Chan of the Tak Chun Group—and the subsequent shutdowns of their VIP companies.
Chan and eight co-defendants are still on trial at Macau’s Court of First Instance for alleged illegal gambling, money laundering and running an illicit criminal organization. They’re also charged with defrauding the Macau government and the concessionaires of revenues. In January, Chau was convicted of similar crimes and sentenced to 18 years in prison.
Industry consultant Alidad Tash, managing director of 2NT8 Ltd., recently told GGRAsia that high rollers may migrate to other jurisdictions rather than risk playing in Macau. “Lots of additional integrated resorts are coming [into the market] and they’re all very welcoming. Koreans are treated much better in Manila and in Vietnam than they are in Macau,” because those locations “have the facilities, the service” to draw such customers, he said.
Meanwhile, U, owner of licensed junket Pacific Intermediário Sociedade Unipessoal Lda told IAG that junkets are especially challenged in the new era, but he expects them to survive in some fashion.
“The industry welcomes the government’s regulation and hopes for healthy development, but it should not be overkill,” he said. “If the regulations are too strict, there is no reasonable room for our survival.
“In a football match, everyone would agree that a good referee makes the match more orderly, but if the referee overdoes it, the game will not run smoothly.”
