Macau has gazetted its administrative regulation for a new gaming concession tender process in about half the time it took the city’s authorities in the preparations for the previous tender at the turn of the current century, observes a Tuesday memo from JP Morgan Securities (Asia Pacific) Ltd.
“We were surprised by how soon the government came up with the tender regulation this time, only 14 days since the enactment of the gaming law” amendment, “versus more than a month in 2001 – despite the ongoing Covid-19 controls,” relating to a local outbreak of infection in the city, noted analysts DS Kim and Livy Lyu. The relevant measure is known as Administrative Regulation No. 28/2022.
“This, in our view, suggests the government’s eagerness to finish the renewal process within the year,” they added.
The brokerage noted that back in 2001, the gaming public tender opened seven days after announcement of the related administrative regulation. That would put Macau on track to do the same thing by mid-July – and possibly as soon as “next week”.
JP Morgan added that at the turn of the century, the public tender closed 42 days after the announcement of the general criteria. That would put Macau in line this time, to close the tender application process in “mid- to late-August”, suggested the brokerage.
In 2001, the “provisional winners” had been announced in early February, 2002, i.e., 105 days after the flagging of the general criteria. That could put Macau on course this time for such an announcement in “late October, early November,” said JP Morgan.
At the turn of the century, the first of the concession contracts had been signed at the end of March 2002, i.e., 153 days after the statement of the administrative regulation. That suggested the latest process could see concession contracts signed in December this year, with the new 10-year concessions being permitted to commence in January 2023.
“We have been and still are of the view that the six incumbent operators will be the next winners of concession” rights, the analysts further noted.
The brokerage said that – from the broad criteria outlined so far in the administrative regulation – there were some “notable changes” from 2001.
These included “plans to expand the source market to foreign countries, social responsibilities that operators intend to undertake, and the level of benefits that operators’ planned investments in gaming and non-game projects can bring in,” said the brokerage.
