The Macau authorities today (Friday) revealed the amendments to the gaming law stipulating a maximum of six concessions, and the duration of the concession capped at 10 years with three years of exceptional extension. The existing gaming concession contract length is 20 years with 5 years of possible extension.
“The longer granting period in the past took into account the time required for the construction of casinos and complexes by the companies that had been awarded gambling licenses in those years,” explained the Executive Council spokesperson, André Cheong.
In the new draft bill, which will be put forward to the Legislative Assembly tomorrow (Saturday), no sub concessions will be allowed. The Government dropped the introduction of a Government delegate to each concessionaire, according to the official.
The bill increases the minimum share capital that must be held by the managing director, who must be a permanent resident of Macau to 15%, up from the current 10%.
In the same statement, the firm holding the casino concession would only be allowed to have up to 30% of its shares listed publicly. That is to ensure a “more stable relationship” between the concessionaire and Macau.
The government intends to raise to MOP5 billion the amount of share capital required in the gaming concessionaire, “in order to ensure the sufficient financial capacity.”
Cheong added that there were no plans to increase the gaming tax rates. Macau taxes the gross gaming revenue of Macau casinos at a rate of 35%.
The government also aims to strengthen the probity checking mechanisms in respect of the concessionaire, as well as of individuals and entities involved in the gaming operations.
Moreover, the bill mentioned that the operation of casino gaming activities must be carried out under the premise of safeguarding the security of the State and the Macau SAR, and promoting the appropriate diversification and sustainable development of the local economy.
Regarding the operation of the gaming promoters sector, Cheong said the government considers it necessary to improve the regulatory regime for the business of junkets in order to ensure the healthy development of the gaming industry in Macau.
“On the one hand, the gaming law will be amended to expressly prohibit the sharing of revenue from the casinos between betting intermediaries and licensees in any form or agreement, and to prohibit the outsourcing of franchised areas of casinos.”
Consequently, the “administrative Regulation No. 6/2002 will be amended, for example, the administrative regulation on the qualification and rules of the activity of promoting casino games of chance will be elevated to law, so as to improve the regulatory regime for the junket sector,” Cheong said.
He stressed that the amendment of the law on junket business will be made according to the “actual situation” in Macau, the characteristics of the operation of the gaming industry, and the public interest of the Macau SAR.
At the press conference Friday, Cheong hinted that the Macau government would consider extending the duration of the current gaming concessions in order to provide lawmakers enough time to complete the review process.