Macau Officials to Meet Gaming Industry After Stocks Roiled

(Bloomberg) -- Macau government officials will meet gaming industry players on Monday afternoon to consult operators on proposed revisions to casino law revision that last week sent stocks in the world’s largest gambling hub into freefall.

The meeting will be the first -- and only -- such gathering between the two sides during a 45-day consultation period on the legal revisions that’s set to end on October 29. Attendees will include casino operators and junkets, which provide services to high-rolling betters and extend them credit. 

Industry representatives expect authorities to give them more details on the proposed changes so they can better gauge the impact on their businesses, according those invited, asking to not be identified as they aren’t authorized to speak publicly about the matter. One of the people said they would be asking about the prospect of government intervention in operations going forward, while another said that they didn’t expect much constructive from the meeting, that it was gesture politics.

Macau will hold four meetings following the consult to solicit views from the public, before drafting a final proposal to be presented to the city’s legislature. 

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 gambling is 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 a panic in the market, with gaming stocks shedding a record $18.4 billion in combined market value last Wednesday.

The Bloomberg Intelligence index of the six big casino operators fell as much as 1.6% Monday, trading at its lowest since January 2016.

While details about the new regulations have been scarce, among the topics being covered during the consultation period are how many licenses -- known locally as “concessions” -- will be allowed, how long their terms will be, and the level of supervision by the government. 

Beijing has for years been purging high-stake betting in the enclave and working to tamp down on overseas gambling trips on concerns they’re serving as channels for money laundering and capital outflow. The latest move, coming just a week after Chinese authorities released their plan for Macau to diversify its economy away from gaming, is likely to deal a further blow to the VIP sector.

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With assistance from Bloomberg