Vietnam’s casino industry has grown steadily since the 2017 decree that provided a legal framework for its operations, but while the sector has contributed significantly to the national economy, experts argue that gaps in the legal framework could hinder long-term growth and effective management.
The findings were published in a study by Nguyen Thanh Minh Chanh and Vuong Thi Thu Thuy from the Industrial University of Ho Chi Minh City’s Faculty of Law.
Issues include unclear investment registration requirements, ambiguous conditions for obtaining casino licenses, and inconsistent regulations regarding casino operations, which complicate both business investments and regulatory management.
To address these challenges, comprehensive legislation on casino activities is needed, including clear development strategies, planning, and resolutions for conflicts between legal documents. These measures should be implemented cohesively to ensure that the casino sector effectively supports the country’s economic growth.
According to research sent to AGB by the authors, since the decree’s implementation, Vietnam has seen increased revenue and job creation in the casino industry.
From 2017 to 2023, the Ministry of Finance reported nearly VND9 trillion ($370 million) in state budget contributions and the employment of over 10,000 workers. Notably, the Phu Quoc casino alone generated VND2.18 trillion ($88.2 million) in 2023, contributing VND1.23 trillion ($49.7 million) to the state budget.
The organization, operation, facilitation or participation in organized gambling or casino gaming remains illegal in Vietnam, with very specific exceptions, namely the licensed casinos and electronic gaming clubs legally operating across the country.
Vietnam lacks a specific casino or gaming law; instead, its casino operations are governed by a complex framework of laws and executive decrees. The primary regulation is Government Decree 03/2017/ND-CP, effective March 15th, 2017, which outlines that casino gaming must comply with various related laws, decrees, circulars, and guidelines.
Additionally, several key regulations address foreign investment, casino operations, tax collection, administrative penalties, and foreign exchange management within the industry.
The study authors warn that regulatory challenges remain, since the requirement for Vietnamese citizens to prove a monthly income of VND10 million ($400) to access casinos has drawn criticism for its complexity and lack of feasibility.
On average, every year Vietnamese people take about VND800 million ($31,511) abroad to gamble at casinos, this is not a small number, not to mention the amount of money played at Vietnamese casinos.
So far only the Van Don and Corona Casino projects have been approved for local play, with Van Don reportedly still under construction and only Corona Casino on Phu Quoc Island open to Vietnamese citizens, who are willing to pay the entry fee and satisfy the specific entry requirements, including providing identification and proof of income.
During the COVID-19 pandemic these rules were relaxed at the Corona Casino in Phu Quoc, with local residents permitted to gamble at the establishment as part of a pilot program that ran for three years. This trial period has been extended until December 31st, 2024.
At the same time, electronic gaming clubs – offering electronic gaming to foreign passport holders only – are permitted to operate in 4 and 5-star hotels predominately located in tourist destinations.
For the authors, the VND10 million ($400) requirement poses challenges, as verifying income for entry is impractical and can lead to fraudulent practices.
‘Observers note that simpler systems, such as identification cards issued by authorities, could streamline the process while maintaining oversight. […] Many Vietnamese travelers seeking leisure do not intend to engage in gambling, making the income verification process cumbersome’ the study points out.
‘In contrast, neighboring regions like Cambodia and Singapore have more lenient regulations, prompting many to travel abroad for simpler gaming options. Despite the Phu Quoc casino generating significant local revenue and attracting over 240,000 visitors, the post-COVID-19 tourism recovery remains challenging. To foster growth in this sector, it is suggested that regulations be relaxed.’
Legal and regulatory gaps
The study also highlights inconsistencies in investment regulations, particularly for casino projects in underdeveloped regions.
Current laws require a minimum investment of $2 billion, with 50 percent disbursed before operations begin, a requirement the authors argue does not account for infrastructure development costs in remote areas, potentially deterring investors.
‘There are many large foreign investors who really want to come to Vietnam to build tourism-resort- shopping-casino complexes. However, legal and institutional problems are still a major barrier that makes investors hesitate’ the study addresses.
‘Therefore, perfecting the legal regulations on regulating casino business activities to suit reality and creating strong progress in this business activity in the coming time in Vietnam is necessary’
The study argues that when businesses want to do casino business in areas with economic difficulties, poor infrastructure or a lack of infrastructure, capital spent on improving connection infrastructure could be included in the total investment for the casino project, capped at 25 percent of the total investment.
Additionally, casino owners would be permitted to transfer their capital contributions within the casino complex for a minimum of five years from the issuance of their casino business license.
Moreover, Vietnam’s casinos face heightened scrutiny due to concerns over money laundering.
While the 2022 Law on Prevention and Combat of Money Laundering has enhanced oversight, experts recommend more detailed guidance, robust enforcement, and international cooperation to counter sophisticated laundering schemes.
The most recent evaluation of Vietnam published in 2022 by The Asia/Pacific Group on Money Laundering (APG), the associate body of The Financial Action Task Force (FATF) concluded that AML/CFT supervision in Vietnam is very limited and the supervision that is conducted is not risk-based.
Casinos have also been scrutinized for their social impact, including gambling addiction and illegal activities. The researchers suggest bolstering measures to prevent gambling-related social issues, such as empowering local authorities, community organizations, and law enforcement to monitor and intervene effectively.
‘Promoting Vietnam’s economy to move forward in a positive direction. However, the process of international integration in Vietnam requires specific changes in law for this ‘smokeless’ industry to develop, it is necessary to improve legal regulations on regulating casino business activities to suit reality and create strong progress in this economic activity in the coming time’, the study authors suggest.
The report underscores the need for a cohesive national strategy for casino development, harmonizing legal documents to minimize contradictions and ensure that the industry contributes positively to Vietnam’s socioeconomic development.
In conclusion, the authors consider that Vietnam’s cautious approach to casino legalization has yielded mixed results. While the industry has bolstered economic growth, particularly in tourism, the regulatory framework requires significant refinement.
By addressing these gaps, experts believe Vietnam could unlock the full potential of its casino industry, positioning it as a driver of economic and social progress in the region.
