Macau, Japan and Singapore. Three vastly different gaming jurisdictions; two highly developed and one with massive potential. Gaming law expert Bruno Ascenção gives AGB a look at some of the highlights of each, derived in part from his LL.M studies in Gaming Law & Regulation with the University of Nevada, Las Vegas (UNLV).
Ascenção benefits from having practiced law in Macau for over 20 years, seeing the booms and busts that accompanied its growth; as well as the shifts in legislation, city planning, and politics involved in it gaining the crown as the world’s gaming capital.
But, despite its international recognition, back home Macau doesn’t want to be known for its lifeblood, focusing instead on promoting a non-gaming narrative.
“Ideally, I would like to see the Macau government explicitly recognize the gaming industry as a vital pillar of the local economy, much as Nevada has done, rather than treating it as something to be cautiously managed or gradually replaced,” notes Ascenção.
“The ongoing rhetoric about diversifying from gaming to non-gaming sectors is difficult to reconcile with current policies, such as the refusal to approve new hotel facilities,” he highlights.
This is not a new topic, as experts draw comparisons between Las Vegas and Singapore in regards to hotel capacity (something Macau is highly restrained in, given its limited land supply).
Even the highly-promoted idea of using the neighboring island of Hengqin (outside the SAR) as a non-gaming hub – particularly for hotel rooms and MICE – has been slow to take off, despite numerous operators acquiring land plots and opening supporting facilities for their Macau operations.
Until Hengqin shapes up, Macau still needs multiple changes: infrastructure improvements, better transportation, improved city planning and a realistic approach to its ‘1+4’ diversification strategy.
And the new administration could be key in that, adopting a more collaborative approach to the six concessionaires which provide some 85 percent of its tax revenue.
“The Macau government should actively involve gaming operators in major decisions, particularly those concerning infrastructure and city planning initiatives designed to attract overseas visitors. As the primary beneficiaries of increased international tourism, the operators possess unique expertise and insight into the preferences, behaviors, and expectations of global travelers,” he opines.
“Their direct engagement in shaping policies and projects ensures that investments are aligned to encourage visitors to spend within Macau’s integrated resorts, ultimately benefiting the entire community and reinforcing Macau’s goal to become a leading international tourism hub.”
At the end of the day, the operators still need to prove to the government that they’re meeting the goals that are expected under their concessions. And Macau’s waters are still a bit muddy.
“My primary concern is more fundamental: there remains a lack of clarity regarding Macau’s true public policy objectives for the gaming sector.”
Bruno Ascenção
Success in Singapore
Interestingly, from a legislative point of view, despite Macau being the frontrunner in Asian gaming, its legal framework has not been significantly highlighted in the approach of either Singapore or Japan.
As part of the UNLV experience, Ascenção was also privileged to meet with regulators and stakeholders in both Singapore and Japan, offering some key insights. Namely, neither one of the jurisdictions chose Macau as a basis for its regulations.
“During our session with the Gambling Regulatory Authority (GRA), Macau was not mentioned at all as a model that influenced Singapore’s legislation, neither in a positive nor a negative light. I found this omission quite telling, as it suggests that Macau’s regulatory framework was not considered a significant reference point by Singapore’s authorities when shaping their own approach,” notes the gaming law expert.
That seems particularly significant, given that Singapore has been highly mentioned as a model for gaming legislation in (hopefully) upcoming jurisdictions such as Thailand.
“It may reflect Singapore’s intent to distinguish its regulatory model or to avoid associations with Macau’s specific challenges and reputation.”
The law expert quotes renowned Professor Anthony Cabot: “Effective regulation is about tailoring systems to local needs, learning from international best practices, and optimizing outcomes based on a jurisdiction’s specific goals and circumstances”.
And Singapore has done this very efficiently, with strong AML measures, strict punishment for illegal gambling, strong licensing criteria, mandatory casino entry fees for citizens, exclusion orders for vulnerable individuals, and bans on casino advertising for locals.
The points prove particularly important for Japan, which hopes to open its first integrated resort in 2030: MGM Osaka.
Framework for Japan
“Just as with Singapore, Macau was not mentioned at all as an influence during discussions about the drafting of Japan’s gaming regulations. This omission is particularly striking given that many Japanese patrons regularly gamble in Macau and that Japanese regulators frequently visit the city,” notes the gaming law expert.
Ascenção notes that, instead, Japan pulled from Singapore and Nevada regulations as influences, “the former for its IR (integrated resort) and social safeguard model and the latter for its casino licensing and anti-organized crime measures”.
Japan had already established its primary gaming legislation – including the Integrated Resort Promotion Law of 2016 and IR Implementation Law of 2018 – before the pandemic.
Future changes could be coming, but it depends on what data is available.
“When asked whether legislative amendments might be preferable at this stage, the response was that any significant changes would likely be considered only after the opening of the MGM Osaka Integrated Resort. The rationale is to first assess the practical impact of the current framework before introducing further amendments,” indicates Ascenção.
And Japan has to battle a completely different beast than either Macau or Singapore: significant problem gambling; however that has not curbed enthusiasm.
“The excitement largely stems from the government’s ambition to attract foreign visitors and strengthen the tourism sector through integrated resorts. However, this is tempered by traditional Japanese unease about embracing gambling, particularly due to concerns over problem gambling and social harm”.
That is not the only problem, however.
“It is equally important for Japanese authorities to address the persistent and significant illegal gaming market. Illegal online gambling, in particular, remains widespread in Japan, with millions of Japanese participating in unlicensed sites and annual wagers estimated at $8.4 billion,” highlights the expert.
While these gaming jurisdictions are not the only standouts within Asia, they do highlight the importance of customized legislation that fits the needs of the government, the populace, and the operators – building a successful model that can scale and adapt, all while protecting its population and funneling the benefits of tax revenues where they’re needed.
Two have already proven themselves. And many are banking on the success of the (soon) newcomer.
