Macau Says Open to Opinions on Proposed Gambling Law Changes
(Bloomberg) -- Macau’s government is open to opinions on its proposed revisions to casino law, officials said at a consultation with gaming industry players Monday, after its vow to tighten rules last week triggered a record stock selloff for casino operators.
The meeting was the only public exchange the two sides will have during a 45-day consultation period on the law that’s set to end on Oct. 29. Still, it yielded little detail on the major issues concerning investors, including how authorities will directly supervise Macau’s casinos, how they plan to increase local ownership in the companies, and which -- if any -- new conditions the city’s six operators will face after their licenses expire next June.
All six of Macau’s major casino operators expressed support for the revision and a willingness to work with the government on diversifying into non-gaming industries at Monday’s meeting, which was livestreamed by some local media. Junket operators, who facilitate high rolling gamblers and provide them with credit, asked for a clearer definition of what authorities think qualify as illegal cash deposits, and what activities count as money laundering.
Macau officials last week said they would change casino regulations to tighten restrictions on operators, as Beijing moves to bolster its grip over the one enclave in China where casinos are legal. Authorities are seeking “direct supervision” over the day-to-day operations of Macau’s casinos, increased local shareholdings in the operators and tighter controls on the distribution of dividends. The announcement triggered panic in the market, with gaming stocks shedding a record $18.4 billion in combined market value last Wednesday.
“One of the purposes of our consultation is to allow Macau’s gaming industry to develop in a healthier and more stable way, increasing our comprehensive competitiveness,” Ku Mei Leng, Chief of Macau’s Office of the Secretary for Economy and Finance, said at the meeting. “We don’t have a preconception, because this is a consultation. We are open to listen to everybody’s views.”
Macau will next hold four meetings to solicit views from the public on the revisions. Officials said they would listen to all opinions, including the most feasible ones in a final proposal that will be presented to the city’s legislature following the consultation period.
Operators including SJM Holdings Ltd., Galaxy Entertainment Group Ltd., Sands China Ltd. and MGM China Holdings Ltd. said they would submit detailed opinions in writing later on, without specifying a time frame.
The Bloomberg Intelligence index of the six big casino operators has fallen 27% since the announcement of the proposed changes, trading near its lowest level since 2010.
Beijing has for years been trying to rein in high-stakes betting in Macau and working to tamp down overseas gambling trips on concerns they’re serving serve as channels for money laundering and capital outflows. The latest move, coming as China pushes to diversify Macau’s economy away from gaming, is likely to deal a further blow to the VIP gambling sector.
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