G3-247 Report SOUTH KOREA
“watershed” to gauge the government’s will toward the casino industry.
Caesars has been aggressively looking for opportunities to expand into Asia have failing to secure permission to build a casino in Macau where rival US companies are flourishing.
Initially the Korean government rejected the licence application, however Korea changed its mind after the group increased the size of its initial investment in the project and also by committing to build a convention centre in the first phase of development.
Caesars Chairman, CEO and President Gary Loveman said at the time: “We are grateful to the Korean govern- ment for their initial approval, paving the way for the opportunity to build and operate our first integrated resort in Korea. We are excited about the opportunity to expand our network and brands to Asia. Foreign visita- tion to South Korea has grown significantly and we look forward to creating a world class destination to further support Korea’s economic growth and tourism goals.”
Officials say this new casino would generate tourism 5 8
receipts of ₩890bn by 2020.
The Korean government announced it will improve related policies and regulations by giving permission for a foreign company to run casinos in Korea. A revision bill was submitted late last year about managing and operating casinos in FEZs and it aims to ease the process of granting foreigner only licences to overseas investors.
The ministry and the Ministry of Trade, Industry and Energy have agreed to work together to receive assem- bly approvals. The government also intends to ease the application system of granting licences to foreign investors by changing it to a content based system meaning it will ease the credit rating system applicable to foreign investors to attract more foreign business in South Korea.
Meanwhile other operators are also looking seriously at South Korea. Japan’s Sega Sammy, the video game and pachinko company, together with Paradise are looking to build a $1.7bn resort in Incheon and have been grant- ed approval. Paradise City is expected to be completed in 2017.
01 “Our case is totally different from the Caesars/Lippo case as we already have a casino licence in the Incheon area so we don’t need a new licence or approval from the government. Under the current Korean Gaming Act, there is no specific hurdle to relocate or expand within the same province. “When we complete the new resort we will shut down our existing Incheon casino and start operations at the new site. Today the Korean gaming industry is receiving a lot of attention from many investors and situations such as Las Vegas Player entering, casino openings in Japan will be a signal for changes just as Macau’s early stage of expansion was down to Singapore’s successful casino results. “But we are also concerned about new competition and we need to be ready for the future by exploring the casino market.”
Heyjeong Shim, IR Manager at Paradise Casino.
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