Tweaks to Macau gaming law keep cross-stake status quo

May 17, 2022 Newsdesk Latest News, Macau, Top of the deck  

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The Macau government is willing to keep the current ‘status quo’ in terms of cross-shareholding in gaming operators, scrapping a previous proposal that would prevent any shareholder with a stake of 5 percent or above in one operator, investing in any rival firm.

Local legislator Chan Chak Mo made the announcement on Monday on the sidelines of a Legislative Assembly committee meeting, when explaining some Macau-government proposed adjustments to the city’s gaming law amendment bill currently passing through the assembly. Mr Chan heads a committee tasked with scrutinising the consolidating bill.

Mr Chan also said the government was introducing some changes to a new rule setting a minimum annual target of casino gross gaming revenue (GGR) for local operators. The proposed amendments would give local authorities the possibility to adjust minimum annual GGR targets previously set, namely in cases of “force majeure” or “unpredictable” circumstances.

As previously set in the original bill, if operators fail to meet such annual GGR targets, they will still be required to pay the city’s government the shortfall in the gaming tax the authorities had been expecting.

According to the existing gaming law, neither a Macau gaming concessionaire nor any Macau gaming concessionaire’s shareholder with a stake of 5 percent or more in that business, can control a stake of 5 percent or more in any other local gaming concessionaire, be it directly or indirectly.

The government’s initial proposal – now scrapped – stated that a shareholder controlling a stake of 5 percent or more in a local gaming concessionaire, could not have a direct or indirect participation in any other local casino operator.

Mr Chan told reporters that dropping that proposal was in order to align with normal investment practices, but the rules would still prevent cases of “unfair market competition”.

Macau casino operator Galaxy Entertainment Group Ltd acquired in 2018 an estimated 4.9-percent stake in U.S.-based casino operator Wynn Resorts Ltd. The latter is the parent company of Wynn Macau Ltd, which operates two casinos in Macau.

Cross-shareholding issues also have been raised in the past regarding businesswoman Pansy Ho Chiu King. She is a major shareholder in local casino operator MGM China Holdings Ltd and has indirect interests in rival casino operator SJM Holdings Ltd, founded by her father, the late Stanley Ho Hung Sun.

Another Macau-government proposed adjustment to the city’s gaming law amendment bill  – as announced on Monday by Mr Chan – included scrapping a proposal to make publicly available market-wide information on the maximum number of gaming tables and gaming machines authorised; instead, that information will be made publicly available on a per-casino-operator basis.

Mr Chan later clarified that the information would in fact only be available on a market-wide basis, and not on a per-casino-operator basis.

(Updated, 10am, May 18)

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