A subsidiary of Macau casino operator Melco Resorts and Entertainment Ltd says in its third-quarter report that the group could face “increased risks” due to “interpretation and enforcement” of laws relating to gaming.
The document by Melco Resorts Finance Ltd noted that as of September 30, the firm’s total liabilities were US$4.81 billion, down marginally from the US$4.88 billion recorded as of the end of 2020.
The Melco Resorts group is the developer, owner and operator of casino complexes under the Melco brand, and holder of a Macau sub-concession licence. It is responsible for properties including City of Dreams Macau (pictured).
Melco Resorts Finance’s third-quarter filing, lodged in the United States on Monday, mentioned specifically the recent and final judgement of a Macau court, known as “the Dore case”, regarding a fellow Macau casino operator – Wynn Macau Ltd – being liable on a joint basis for VIP junket deposits made at its junket rooms.
According to several industry insiders, it is not yet clear what the impact of the judgement in that case could be, namely regarding other pending cases involving the Dore brand of junkets.
Melco Resorts Finance’s filing also however referred to another recent major event: the detention in Macau on Saturday of Alvin Chau Cheok Wa, boss of the Suncity Group brand of junkets, and 10 other people described by Macau authorities as “senior administrators” of a “criminal group”.
Mr Chau is currently being held in pre-trial detention in Macau, on suspicion of offences including facilitating online gambling via the Philippines for Chinese customers.
On Tuesday it emerged that the Suncity brand was to close its Macau VIP rooms with effect from the early hours of Wednesday (December 1).
Melco Resorts Finance stated in its Monday filing referring first to the Dore case: “In November 2021, the Court of Final Appeal in Macau issued a final unappealable decision that a gaming operator is jointly liable with a gaming promoter for the refund of funds deposited with such gaming promoter at a casino.”
Melco Resorts Finance added that later that month, “the Macau authorities arrested executives from a gaming promoter for alleged illegal overseas gaming related activities.”
The Melco Resorts unit added that gaming was a “highly-regulated industry in Macau and is subject to various laws and regulations”.
It added such rules were “complex and there are limited precedents on the interpretation and enforcement of these laws and regulations”.
In comments to analysts in early November during the third-quarter conference call of Melco Resorts, chairman and chief executive Lawrence Ho Yau Lung had said the VIP segment in Macau was “structurally impaired”.
The comment was made in the context of a question about a continuing focus in China on limiting consumer extravagance as part of the country’s ‘common prosperity’ policy.
In the future, Macau gaming was “going to be focused more on mass, and mass is going to need more amenities and more non-gaming attractions,” added Mr Ho.
In its third-quarter results, Melco Resorts Finance reported it had narrowed its net loss to US$139.9 million, from US$203.4 million a year earlier.
Jan 21, 2022An article in Macau’s draft new gaming law, to create a mechanism to dissolve an existing gaming concession in the event it was not granted a new licence after the current six concessions...
”There are no gaming promoters currently operating at Galaxy Entertainment Group”