Gaming concessionaires will be required to inform the Macau chief executive about any “major financial decision” involving amounts higher than what is proposed in their concession contracts, or else face a fine of up to MOP5 million or even possible license revocation, local media reports.
This was one of the proposed amendments to the gaming law, which was discussed during the 10th session of the Legislative Assembly second standing committee.
Speaking to local media after the meeting, head of the Legislative Assembly commission Chan Chak Mo said that each concession contract will establish a proposed predicted investment volume to be carried out by the operator. Any changes in the amount which is higher than what is proposed in the concession contract will need to be communicated to the chief executive.
“According to the government, this would depend on the scale of each operator or the different phases of its investment. If its predicted investment is MOP5 billion and the amount is deemed not enough later, it can be increased but this needs to be communicated to the CE,” said Chan, quoted by Macau Business.
“However, this might not just involve a change in the investment amount, it could just be a change in the investment strategy. Government representatives did not specify this. The most important is the changes involve amounts higher than what is predicted in the concession contract”
Chan said that any concessionaire that fails to inform the CE would be fined between MOP2 million and MOP5 billion (US$620,000) or could even have their gaming license revoked.
“I believe this fine infraction could be considered a contract breach or even lead to a concession contract to be revoked,” Chan said
Authorities did not specify what defines a “major financial decision” and did not clarify whether they include the concession holder or the parent controlling entity as well.
It was also questioned whether a dividend distribution could be classified as a major financial decision, though this has also not been made clear.
According to Macau TDM, other items discussed during the second standing committee session is a proposal that requires concessionaires to sell their shares only to existing shareholders. Should a third party signal intention to buy shares, they would need to undergo qualification / suitability assessments.
Another proposed amendment suggests that each gaming junket operator will only be allowed to do business with one concessionaire and is only allowed to earn commission.