GGRAsia – Uptick in agent interest re Macau junket licensing: sources

Uptick in agent interest re Macau junket licensing: sources

Nov 01, 2017 Newsdesk Latest News, Macau, Top of the deck

Macau has seen a resurgence in the number of so-called collaborators in the VIP gambling segment, as business has improved this year, with some of them interested in getting licensed by the government as VIP gaming promoters, several veterans in the field have told GGRAsia.

In the local context, “collaborators” can be agents or sub-agents – typically from mainland China – that bring in high-value players to the casinos, but are not themselves currently licensed as VIP promoters i.e., the people authorised by the city’s government to arrange player credit and collection on player gambling losses. In Macau these licensed entities are commonly known as “junkets”.

Macau junket investor U Io Hung, the chairman of a Macau VIP club branded “CCUE” that operates at Altira Macau, told GGRAsia he had seen more VIP gaming collaborators working in the city so far this year. Some of them were people that had been active in the Macau market previously, but had exited during the market downturn that reached a bottom in 2015 in terms of year-on-year decrease in casino gross gaming revenue (GGR).

“There are more junket agents seeking to be licensed as a promoter firm at the Gaming Inspection and Coordination Bureau,” said Mr U, referring to the local regulator, a body also known by its Portuguese-language acronym, DICJ.

In the third quarter of 2017, casino gross gaming revenue (GGR) in Macau’s VIP baccarat segment expanded by 35 percent year-on-year, according to government data.

The VIP segment’s share of all casino GGR in the third quarter was also on the rise judged year-on-year. VIP baccarat GGR in the July to September period was 57.7 percent of all casino revenue, versus nearly 52.1 percent of GGR in the third quarter 2016.

Kwok Chi Chung, president of the Association of Gaming and Entertainment Promoters, agreed with Mr U’s observation regarding collaborators.

“Lately there have been indeed more gaming collaborators that have interest in getting licensed as a VIP gaming promoter firm… quite a number of them are from mainland China, have been running their business in Macau and made some established [client] networks over a period of years and would just like to register a firm of their own name,” Mr Kwok stated.

In an emailed reply to us, the gaming regulator noted that currently, the number of licensed junket promoters is “very close” to the number that was published at the beginning of this year.

The total number of licensed gaming promoters in Macau was 126 as of January this year, compared to 141 in January 2016, according to a list of licensed operators published every January by the bureau. In January 2015, Macau had a total of 183 licensed junkets.

Gaming promoter licences are issued or renewed by the local regulator on an annual basis. The city’s VIP gaming promoters also have to submit every year a list of the collaborators they plan to work with in the following year.

The gaming bureau has the discretion to restrict the number of collaborators a licensed gaming promoter can work with, or the regulator can choose not to approve certain names on a collaborators’ list, local regulation says.

Despite having seen an uptick in interest in junket licensing, Mr Kwok said he was not certain whether that would lead to a significant increase in the number of registered junket promoters.

“The DICJ has toughened up their screening of the workings of the junket promoters, and they are also working on revising the law monitoring junkets,” Mr Kwok remarked. “I don’t think getting licensed as a junket firm is that easy any more.”