LEGALIZATION Japan In Two Years?
Approval is imminent on a bill that could result in an integrated casino resort in Japan
R By Michael Hands
ecently, I visited the Tokyo offices of Issei Koga, chairman of the Diet’s bipartisan Casino Committee. My intention was to
receive firsthand the most current information on the Japan gaming process. I was advised that the initial promotion law bill
is complete and ready for submission to the Diet for review and approval. The actual timing of the sub- mission has not been determined, but I was assured that this would take place later this year. I was also advised that there was a 50-50 chance that the bill will be approved and passed prior to the end of 2011, and a 100 percent chance of it being approved and passed by June 2012. Once passed, the cabinet takes over and the pro-
motion law bill, which is a bare-bones bill, will be assigned to a ministry. Once assigned, the ministry’s civil servants will take over and fill in all the details to turn it into an implementation law bill. This process is expected to take two years, sim-
ply because this law has no precedent in Japan; they are starting from day one to introduce a completely new industry into Japan, and an industry of which the ministry has no prior knowledge. It is expected that there will be a public com-
ment, and it’s important for interested parties to retain representatives who have access and industry knowledge to advise in crafting the implementation law bill in order to create a win-win for everyone. The individual host local governments will
receive the authority to identify the specific gaming company or companies with which it wishes to be associated. In this context, it’s important that the companies reach out early to these individual local jurisdictions. It will be a “beauty contest selection process” for local governments selected to receive the authority to issue licenses, and their selection will be based on the strength of their presentation and demonstrated need. The proposed host local governments do not
have the resources or knowledge to do this on their own, so it is crucial that interested parties quickly create a relationship with a proposed host jurisdic- tion/community, identify a specific property, pro- vide economic feasibility studies detailing job cre- ation and in-bound tourism statistics, and create some iconic designs.
22 With this package complete, it should then be
shared with the regional community to develop a strong consensus. Remember that Japan will not do anything without a positive consensus being in place. Several locations come quickly to mind includ-
ing Tokyo, the Osaka region, Nagoya, Kyushu, Hokkaido and Okinawa. The local government should secure the funds
from its own budget to run the IR committee. Okinawa and Osaka had their own IR committees for several years. Local governments require a lot of input from global operators. Local governments are extremely sensitive about receiving funds from overseas operators, but they welcome research works, FS studies, education for local people and PR support. While Tokyo
could undoubtedly be the biggest prize of all, it might also be déjà vu. Recall that a number of years ago, Tokyo Governor Ishihara dropped the casino initiative to focus on and pursue the 2016 Olympic Games. That effort failed, but now the governor has decided to pursue the 2020 Olympic Games, and the decision on awarding the location by the Olympic Committee will not take place until 2013. It might require some heavy lob- bying to convince the governor that he can have both the Olympics and a casino. Osaka will receive strong support from the very
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order to provide them with an understanding of the benefits that an integrated resort can bring to their community in terms of substantial direct and indi- rect job creation. This type of public promotion is exactly what
we’re pursuing right now in Korea. In Japan, a pri- vate group will take on the task of educating the public, and they will do this with funding from major Japanese developers and other interested con- stituencies which they hope will also include the gaming industry. My final advice is that interested parties, instead
years. Local governments require a lot of input from global operators.
committees for several
Okinawa and Osaka had their own IR
of lobbying the central government, should get out into the country and develop a relationship with a local and prefecture government, because these are the constituencies who will make the decision on with whom they will partner. The central government is
positive Governor Hashimoto. Due to the strong efforts of Penn National Gaming, Kyushu already went through most of the recommended local gov- ernment process in the 2006-2008 time period, and has maintained good relations ever since with the local constituencies. Both Okinawa and Hokkaido will be high on the central government’s list, because both are relatively depressed communities which the government is highly motivated to support. Koga does not have the funds to promote this
bill within the Diet, and more importantly to pro- mote the IR concept to the general public. The general public education process is important in
Global Gaming Business • November 2011
2002. For the past five years, I’ve been living in Korea, and have used some of the knowledge and relationships gained in Japan to assist in the Korea integrated resort initiative, while at the same time keeping in close touch with Japan. The Korea Initiative appears to be moving along quite well, but its success will have no effect on the Japanese timing. The Japanese will do their own thing in their own time, and will not be pressured or intimidated by what their neighbors are doing in the gaming space.
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Michael Hands resides in Seoul, Korea and is chair- man and CEO of Travel & Leisure Company (TLC), a newly created Korea corporate company that was preceded by Gaming Asia-Pacific Company, which was established in 2002. Hands has been representing major gaming companies seeking new gaming develop- ment opportunities in the Japan and Korea. He pos- sesses a strong knowledge and presence in both Japan and Korea and maintains offices in both Seoul and Tokyo. Contact Michael Hands at
mjh@gapc.asia.
always happy to meet with major overseas companies, but their job for now is completed once the bill has been submitted. This is my summary, based
on my having “worked” on the casino process in Japan since
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