questioned in a press conference later, that he hopes a public consultation on the revisions to the gaming regulations could start in the second half of this year, which “has been delayed for a few months by the virus outbreak.” The official noted the sub-concession model would be eliminated, but declined to say the number of gaming licenses to be granted in the future, as the government awaits for the public opinions on the topics during the consultation exercise.


Given the current schedule by the government, investment bank, JP Morgan, noted in a recent research note that the rebidding process might not be ready when the six licenses expire by 2022 as the revisions to the gaming regulation will only be completed by next year at the earliest. “We wouldn’t be surprised to see the renewal [retendering] process postponed by a year or so versus the current expiry of June 2022,” the research note read. In other words, the six gaming licenses have to be

extended for a certain time period if the retendering process could not be completed before June 2022. According to the current gaming rules, the existing operators could see their licenses to be extended by a maximum period of five years at the end of their concessions or sub-concessions. The licenses of SJM Holdings Ltd and MGM China Holdings Ltd have been extended for two years from 2020 to 2022 by former chief executive Fernando Chui Sai On in a bid to align the expiry date of all the licenses. The current regulations also mandate the government has

to extend the existing concessions and sub-concessions at least six months prior to the expiry. Given the lapse of all licenses here on June 26, 2022, this means the government must extend the licenses no later than the end of 2021, should the rebidding process not be concluded on time.

Achievable before deadline

While Ricardo Chi Sen Siu, director of Centre for Career and Research Advancement in Integrated Resorts at the University of Macau, acknowledges the possibility for the government to extend the gaming licenses for a short time period beyond 2022, the scholar believes there is still time for the government to complete all the works for the rebidding process before the deadline. “The time frame is tight, but it is not impossible to achieve,” he notes. “In consideration of the competition from nearby gaming

markets and other factors, it’d be ideal for the government to complete the retendering process before the expiry [of the existing licenses],” he says. “There will be more uncertainties in the process should the current licenses be extended [for a certain time period].” “The previous administration has done a lot of preparation for the rebidding process with many documents ready to go, thus enhancing the efficiency of the current administration [on the matter],” Prof Siu continues. Provided that the public consultation exercise to be completed this year, there are still “a couple of months for the Legislative Assembly to review and approve the revised gaming regulations in 2021 and then the government could reopen the tender by 2022,” he notes.

Geopolitical struggle

The authorities had indeed started a so-called “mid-term review” of the gaming industry in 2015, with a detailed report completed a year later, which was described as paving a way for the future retendering process. However, it has been reported by local media outlets that the government had completed drafting the public tendering documents and the rebidding process was supposed to be concluded last year – but the trade war between China and the United States since 2018 has hindered the process, as three of the six gaming operators in Macau are backed by US capital, namely Sands China Ltd, Wynn Macau Ltd, and MGM. When asked about the possibilities of any existing six gaming operators failing to retain their licenses, Prof Siu declines to make any guess and only says “a lot has happened” in the past year and more. Though the world’s two largest economies have signed a

phase one trade deal earlier this year, which has ameliorated the trade tensions between the two countries, the relationship between China and the US has not seen any signs of improvement, with both sides pointing fingers at each other over the ongoing COVID-19 pandemic and the months of protests in Hong Kong since last year. Hong Kong-based political and corporate risk consultancy, Steve Vickers and Associates, has warned the Macau gaming operators with the US capital “are sitting on a geopolitical fault line” and the local authorities “might simply refuse to grant a new right to current concessionaires.” While the latest Policy Address, and Mr. Ho’s recent

remarks, did not comment on the future of the current gaming operators, the Chief Executive emphasized last month the retendering process would be a public tender. “Any parties are welcome to join the bidding and [the government] will not mandate only a certain company could participate in the process,” he added. His comment seems to have squashed the realms of possibility that the authorities might lay down bidding rules to make it difficult for other companies, rather than the current operators to participate in and win.

Number of licenses

Billy Song Wai Kit, president of the Macau Responsible Gaming Association, has expected not all the existing

JULY 2020 21

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