Japan’s Integrated Resorts (IR) Implementation Bill passed into law on Friday evening after a plenary session of the upper house of the country’s parliament.
The passage of the second of two pieces of enabling legislation for establishing a domestic casino industry marked a victory for the government of Prime Minister Shinzo Abe. It had pledged to complete the process prior to the expiry on Sunday of the current – extended – ordinary session of parliament prior to the legislature’s summer break.
The approval of the bill also frustrated the efforts of some minority parties. According to GGRAsia’s information, such interests had on Thursday and Friday moved no-confidence motions in the upper chamber – the House of Councillors – in order to trigger plenary sessions of that body and divert effort away from a discussion of the bill in a house committee.
The idea of having casinos, ostensibly, is to stimulate growth in inbound tourism; to create new infrastructure for events, conferences and hotel space using private investment rather than the public sort; and to create an economic multiplier in some places aside from the major conurbations.
Commenting on the passage of the IR Implementation Bill, Jim Murren, chairman and chief executive of casino operator MGM Resorts International, said in a statement: “The process has been very deliberate and transparent. We appreciate the high level of social responsibility reflected throughout the process by creating one of the most comprehensive bills of its kind anywhere in the world.”
MGM Resorts, the parent of Macau casino firm MGM China Holdings Ltd, has declared itself a contender for a Japan casino licence. The U.S.-based company – like other casino operators – already has a full-time development team in Japan.
“Today’s passage allows us to advance our relationships with key stakeholders and together create a coalition of Japanese business partners who will collectively define a vision for a uniquely Japanese, world-class integrated resort,” added Mr Murren.
Japan’s casino liberalisation plan has been likened by some commentators to a fourth “arrow” supplementing Mr Abe’s “Three Arrows” economic policy, those being monetary easing, fiscal stimulus, and structural reforms.
Japan recorded a government debt equivalent to 253 percent of the country’s gross domestic product as of December 2017, an all-time high, according to data from the country’s Ministry of Finance. The nation’s low birth rate and ageing population mean that there is a shrinking base of taxpayers, while aggregate entitlements payable to economically-inactive citizens grow.
But according to a number of publicised surveys, there is no strong majority among Japanese in favour of casino liberalisation.
The passage of the bill still leaves plenty of work to be done before a Japanese casino industry can be created. Not the least of it is the pitches to be made to central government by local authorities – in tandem with their respective private-sector partners – for the right to one of the first licences.
A number of industry executives expect the first casino licences to be issued in around the year 2020, with the first resorts to open for operation in circa 2025.
The statute legalising the concept of Japanese casino gaming venues – the Integrated Resorts Promotion Bill – came into effect in December 2016. Reasons for the delay to the second enabling bill included a snap election called by Mr Abe in the autumn last year, as he sought a fresh mandate for a raft of reforms.
A separate piece of legislation related to the nascent casino industry – the Basic Bill on Gambling Addiction Countermeasures – was passed by parliament on July 6 this year.
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Analyst at Roth Capital Partners