The UNLV Gaming Law Journal has this week published a study by a Macau-based gaming lawyer tackling the issue of casino reversion once concessions or sub-concessions expire.
In the paper, titled “The Reversion of Casinos Under Macau’s Concession Model,” gaming expert António Lobo Vilela emphasizes Macau law’s stipulation that the “reversion-transfer” of casinos to the government occurs upon the expiration of licenses.
This reversion gives the government the power to gain possession of certain assets.
The paper further analyzes the Macau law’s concept of reversion and the definition of casino, which are central to the implementation of the reversion mechanism for casinos, gaming equipment, miscellaneous items, and other “assets or rights which must revert under a contractual clause” to Macau authorities.
As cited in the study, the reversion of casinos is not new for Macau’s gaming industry, despite the 1961 Gaming Law stating that only the works of exclusive public utility developed by the concessionaire pursuant to contractual obligations will revert to the state.
This law, however, specifically exempted the “model casino and a luxury hotel” that was to be built before December 31, 1964, with characteristics that were fixed in the notice or call for tender.
Meanwhile, in the draft of the bill amending the local gaming law, the government had already stated what is considered a “casino” for the purpose of reversion. It includes not only the gaming floor, but other areas where operational activities are conducted.
“This includes, for instance, the cages, the places where you count the money, the areas where you store gaming chips,” Vilela explained.
“[The draft law] stated ‘other logistic services,’ but we don’t really know what that [covers],” he added, noting the criterion that is necessary for the operation of games of chance to continue without operational interruption.
This implies that reversion will also occur for other casino-related property. This may include canteens within integrated resorts and laundry services, as gaming staff uses the areas together with non-gaming employees if “ancillary, complementary, or directly and necessarily related to the regular operation of the concession or sub-concession.”
Surveillance rooms will also revert, as integrated resorts have designed the rooms to monitor activities as a whole, not just within the casino floor area.
Further, the author of the Macau Gaming Law Book has opined that the “lack of registration or registration under strata title makes the reversion rest over an aliquot part of the property and the land itself.”
As cited in the study, the Land, Public Works and Transport Bureau (DSSOPT) has stated publicly that “the reversion of the respective properties is clearly defined, and DSSOPT will strictly comply with the concession contract for each unit of land.”
The full paper, published in UNLV Gaming Law, is available here.
