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MAJOR MACAU OPERATORS DISCUSS REGULATORY OPTIONS

The subject of regulation was discussed this week in Macau at a special meeting with major gambling concessonaires called by the Macao Special Administrative Region (SAR) government. Predictably, there were different opinions on the subject from the six gaming concessionaires and sub-concessionaires who met face-to-face for the first time to discuss gaming market regulations.
 
Present were local gaming magnate Dr. Stanley Ho and Las Vegas Sands' Asian Region President Steven Weaver, along with top government officials, reports the Chinese news agency Xinhua. With a moratorium on the PokerStarsissue of further licenses, the original aim of the gathering was to discuss the future development of the island's gaming industry.
 
Tam Pak Yuen, secretary for economy and finance of the SAR government told Xinhua that in the event the discussions focused on issues concerning junket commissions and gaming table numbers. Tam said that most of the representatives agreed at the meeting that the commission should have a lower maximum rate than the current market level, while opinions differed when it came to the number of gaming tables allowed for each concessionaire.
 
"The government takes the responsibility to regulate the gaming industry, ensuring its healthy and sustainable development, and now it is time to take a more active step and provide a platform for the operators to exchange their opinions," he said.
 
Last month's decision by SAR Chief Executive Ho Hau Wah to freeze the development of new casino projects and maintain the current industry scale, has been welcomed by Stanley Ho's SJM, Melco International, of which his son Lawrence Ho is chairman, and Wynn Macao from Las Vegas.
 
"The only way to control this crazy cutthroat competition is to control two things, the number of (gaming) tables for each licensee and the [VIP market] commission rate," said Stanley Ho after this week's meeting. Last year the VIP market contributed more than 67 percent of the total games of fortune revenue, according to figures from the Gaming Inspection and Coordination Bureau.
 
Ho said he proposed at the meeting that maximum commission rate and gaming table number for each concessionaire or sub-concessionaire be limited at 1.25 percent and 1 000 respectively, but this was not welcomed by all the other operators. He said that the Las Vegas Sands representative had disagreed with Ho on most of the issues brought up at the meeting.
 
Las Vegas Sands has invested heavily in Macao's gaming market and built the Venetian Macao, which housed the largest casino in the world. Stephen Weaver, representing Sands at the meeting, argued that table number and commission rate should be decided by the market.
 
Xinhua reports that the Macao Business monthly market share report shows that SJM still dominates the Macau market with its 28 percent share as at the end of March this year, following by Sands, which took up 20 percent.
 
Weaver commented that merely building "casinos that are just casinos" does not meet the objective of Macao as a society.
 
"What we think [is that] Macao is a society and the government's intention of opening up the industry was to bring in the kinds of resorts that would attract new tourism traffic, business traffic, people who want to come for shopping, entertainment and so on," Weaver said.



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