Melco Resorts and Entertainment says that the recent developments concerning Macau’s junket and VIP space is a signal of increased risks for operators, whilst Covid-19 continues to have a material effect on its operations.
Melco made the comments within a quarterly report for the quarter ended September 30, 2021, which was released on Tuesday.
“Gaming is a highly regulated industry in Macau and is subject to various laws and regulations. These laws and regulations are complex and there are limited precedents on the interpretation and enforcement of these laws and regulations. Changes in laws and regulations, and the interpretation and enforcement of such laws and regulations, may result in increased risks for operations on our properties,” said Melco.
In November, Macau’s highest court upheld a ruling that found Wynn Macau jointly liable with junket operator Dore Entertainment for the repayment of a HK$6 million debt to a VIP player, setting a precedent that makes the gaming operator jointly liable with a gaming promoter for the refund of funds with the gaming promoter.
According to legal experts in Macau, the case has been seen as crucial for the future of the local casino industry in that it defines the responsibilities of the concessionaires for the actions of the junkets.
On the other hand, just last weekend, Suncity Holdings Chairman Alvin Chau was arrested on suspicion of being in a criminal ring, running illegal gaming activities, and money laundering.
His arrest has far-reaching implications for Macau’s struggling VIP business and may also extend to the crucial premium mass business, analysts say.
Melco also noted that Covid-19 continues to have a material effect on operations, financial position, and future prospects in the fourth quarter of 2021.
“Our operations have been impacted by on-and-off travel restrictions and quarantine requirements as imposed by the governments of Macau, Hong Kong, and China in response to isolated cases.”
Last weekend, a new strain of Covid-19 was discovered in South Africa, with worries it may be more transmissible than the currently dominant delta strain.