MACAU BUSINESS
Inspection and Co-ordination Bureau, also issued stricter rules last year for junket operators, who are required to provide backgrounds for their key personnel in financial operations and to compile monthly accounting reports. “The government has imposed stricter rules on the industry, particularly for junket operators, to facilitate the healthy development of the sector amid the anti-corruption campaign,” said Carlos Siu Lam, Associate Professor of the Gaming Teaching and Research Centre of Macau Polytechnic Institute. “The chief of the regulators has emphasised the rules will continue to be improved for the benefit of the industry.”
Non-gaming push He refers to Paulo Martins Chan, former
Assistant Prosecutor-general, who replaced long serving Manuel Joaquim das Neves as Director of the gaming regulator in December 2015. Mr. Chan says updating the laws concerning the industry is the priority of his tenure. At the height of his fight against graft, Mr. Xi paid a visit to the gaming enclave in December 2014 with a clear message: the city’s economy has to become less reliant upon casinos. This has promoted the Macau Government to lay down it first five-year development plan, including a target that non-gaming revenue should account on average for at least 9 per cent of all revenue generated by Macau gaming operators by 2020. “The recent closure, or suspension, of non- gaming offerings in some [Cotai] properties shows there is still a long way for gaming operators to develop in this area,” says Professor Siu. ‘The House of Magic’ show at Studio City, mostly owned by gaming operator Melco Resorts and Entertainment Ltd., was closed in early October, with some analysts stating the magic show failed to be financially feasible. In the same month, another operator, Sands China Ltd., ended its five-year partnership with California-based DreamWorks Animation SKG, in which Sands no longer uses
the latter’s cartoon characters for entertainment offerings at its Sands Cotai Central property. “The local market is different from Las Vegas,
where non-gaming makes up a large portion of the revenue, as visitors here stay on average merely 1.4 days,” the academic added.
All about renewals
“The past few years are indications of the impact of any changes in Beijing’s policies on Macau,” said a local gaming industry source, speaking on condition of anonymity. “So far, we don’t see the ongoing corruption campaign will hurt the industry as much as it did [in the 2014-15 period] - but when we’re talking about Beijing you can never foresee its next step.” Compared with the fight against ‘tigers and
flies’ on the Mainland, the gaming licence renewals are the top concern for operators in the coming years, the same person said. “There has yet to be any clear indication provided for the process,” the same source noted. The city’s six gaming concessions and sub-
concessions will expire by 2020 and 2022, but the government has yet to define the criteria for renewals or whether any new licences will
be granted. The authorities only compiled a mid-term review report last year on the performance of the six operators since the liberalisation of the gaming market in 2002, a report officials stressed had no direct relationship to the renewals. Some stakeholders have already championed
more licences. Political heavyweight and businessman Chan Meng Kam said the gaming market “should be opened further”. In late September, speaking at the opening ceremony of his Casio Royal Dragon - a satellite casino he runs under the licence of gaming operator SJM Holdings Ltd. - he said the government should accelerate its process on the renewal talks, adding he “is not yet interested in” bidding for a licence, if possible, though. Including Casino Royal Dragon and nearby Casino Golden Dragon, Mr. Chan now operates three satellite casinos in the city, purchasing another third- party casino, Lan Kwai Fong casino-hotel, on the Macau Peninsula in October. What’s been clear, though, is Beijing will
certainly have a say in the matter. At the Party Congress in late October, Mr. Xi emphasised that the central government will maintain its “firm grasp” over Macau and Hong Kong.
22 NOVEMBER 2017
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