Macau authorities feel they have everything they need to put the city’s new gambling laws in place. The first test will come when the General Assembly reviews the recently published draft next week.
There have been doubts that the city would be able to issue gaming concessions on time this June. Now that Macau’s casino operators know what to expect with the new gambling laws, though, it’s time to move to the next step.
The General Assembly will review the framework on January 24. Provided there is no significant resistance, the laws could be approved well in advance of the deadline.
Changes in the Laws Not Anticipated
Pushback to the new laws isn’t likely, but changes could be suggested during the first reading. The laws and any recommendations will then make their way to an Assembly subcommittee for approval. After that, another reading and a vote by the General Assembly will take place.
The goal is to have the laws finalized and approved before June 26, the day Macau’s six casino operators’ concessions expire. However, if any unexpected issues arise between next Monday and that date, the city is ready to issue extensions of the existing concessions.
The arrival of the draft laws provided a collective sigh of relief to Macau’s operators. Some of the previous recommendations, such as extreme daily vigilance of their operations, are no longer included.
All six of the operators should be safe once the concessions arrive. However, the reduction in the duration of the concessions from 20 years to 10 wasn’t a highlight.
Satellite Casino Could Eventually Go Away
Among the many changes that are coming, satellite casinos are facing an uncertain future. These venues have been able to piggyback off operators’ concessions, but are run by independent investors. This option will no longer be available.
The satellite casinos will have three years to figure out how to more closely align their operations with licensees. In other words, the satellites will eventually become full assets of the concessionaires. This has caught some operators by surprise.
One is Success Universe Group, which backs the Ponte 16 resort in Macau. It operates under the license of SJM Holdings, but this will have to change if the law stays as it now reads.
Hoffman Ma Ho Man voiced his concerns to GGRAsia. He stated, “Is that a transfer of… 100-percent ownership,” to a concessionaire, “or are there any particular shareholding requirements?”
Ma added, “If what the government proposed for the satellite casinos is to be enacted, it would boil down to an issue between the satellite casino investors and the gaming concessionaire: whether the asset in question is to be sold on a reasonable price or not?”
Negotiations Between Satellites, Licensees
The director of the Centre for Gaming and Tourism Studies, Wang Changbin, points out that the new law details how satellite casinos will work. However, it doesn’t address the economic considerations.
Eventually, the satellite investors may have “no role as a gaming operator.” This could conceivably undermine the funds they have injected over the years.
SJM Holdings CEO and vice chairman Ambrose So Shu Fai will likely start looking for a solution now. He predicts a “cooperation” model between the investors and concessionaires will arrive, according to Hong Kong-based media outlet Ming Pao.
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