Macau Considering Casino Junket Credit Ban
LISTEN TO THIS ARTICLE:In a move designed to continue limiting their activity in the city, the Macau government has proposed to ban licensed junkets from issuing credit to gamblers using local casinos. This proposed ban, which would replace the current system where both junkets and casino concessionaires can provide credit, marks a significant shift in the city's gambling regulatory landscape.
Limiting Junkets in Macau
The current regulatory framework, which was introduced in January 2023, allowed junkets to issue credit to high-rollers or VIP players, a critical segment of the Macau gaming industry. However, the government's proposed ban suggests a desire to tighten control over credit issuance and potentially reduce the influence of junkets in the industry.
Related: Junkets Return to Macau against China's WishesChan Chak Mo, the head of a standing committee of the Macau Legislative Assembly tasked with scrutinizing the proposed bill, stated that the government's proposal deletes current provisions that allow junkets to issue credit. He added that the proposal retains the rule whereby junkets can still assist in bringing clients to casinos and serving them, but they will no longer be directly involved in credit issuance.
This shift in policy is partly driven by concerns about the risks associated with junket credit. Junkets, which act as intermediaries between casinos and high-rollers, have been linked to cases of loan sharks and money laundering. By eliminating direct credit issuance by junkets, the government aims to enhance financial oversight and reduce the potential for illicit activities.
Another factor driving the proposed ban is the declining role of junkets in the Macau gaming industry. The number of junkets operating in Macau has dwindled significantly, from over 300 in 2014 to just 36 in January 2023.
Gaming Industry Raises Concerns
The proposed ban, if implemented, would further marginalize junkets and shift more control over credit issuance to casino concessionaires. Casinos, being licensed gaming companies with established financial systems, are deemed to be better equipped to manage and control gambling-related credit.
However, the proposed ban has met with mixed reactions from industry stakeholders. Some casino operators have expressed concerns about potential revenue losses, while junkets have argued that the ban would disrupt their business and could lead to job losses.
The Legislative Assembly is expected to continue discussions on the bill in February, followed by a final reading at a plenary session. If approved, the law could come into effect in the middle of next year. The full impact of the proposed ban on Macau's gaming industry remains to be seen, but it undoubtedly signals a significant change in the city's regulatory approach.
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