Macau’s gaming laws have been the main topic of discussion in the recent period and now, it has been revealed that the government of this special administrative region will have the power to alter the minimum required GGR that concessionaires need to reach based on economic conditions.
Macau’s Gaming Law is Facing Several Amendments
Apart from the changes in the GGR, Macau is also considering giving concessionaires tax breaks, but only if they manage to attract foreign customers. Concessionaires in the region are having trouble attracting offshore players, mainly because of the travel restrictions imposed by mainland China.
In the original text of the Gaming Law, it was stated that the concessionaires would have a minimum GGR amount that they need to reach annually. However, Chan Chak Mo, the chairman of the Legislative Assembly Second Standing Committee, stated on Monday that the new text will have the words “annually or at a specific time,” rather than “annually.”
Additionally, Macau’s government will set a minimum income requirement per slot and per table game. The new text elaborates that the minimum income requirement can be altered by the government, depending on the economic conditions in the region.
As Chan explained, the reason why the government needs to have the power to alter the income requirement is if any “unforeseen events” take place. One of those events is the COVID-19 outbreak, which had a massive impact on the global gambling industry.
Section 5(C), states that:
The total maximum number of gaming tables and slot machines to be operated would be announced by the chief executive.
This will be changed to:
The total maximum number of gaming tables and slot machines that may be operated by each concessionaire will be announced by the chief executive.
Thanks to this amendment, the chief executive will announce each concessionaire’s number of slots and gaming tables, not just the aggregate number for all of the concessionaires. Lastly, it was noted that by failing to comply with these regulations, a fine between MOP$2 million ($247,000) and MOP$5 million ($618,000) may follow.
Reaching the Minimum Required GGR May Be A Problem, if the Situation Continues
Macau concessionaires may have a problem reaching the minimum GGR requirement if it’s set too high, especially if the restrictions do not ease up.
In March, the total GGR of the special administrative region was MOP$3.67 billion ($454 million), which was the lowest in the past 18 months. Its YoY decline was 55.8% and the GGR in February was 53.7% higher.
COVID-19 was cited as the main reason why Macau’s GGR had such a negative impact. The outbreak ravaged mainland China, including Shenzhen and Zhuhai. Shenzhen’s situation was so bad that the region had to be locked down for a whole week. To make things even worse, the April GGR was even lower as it reached MOP$2.68 billion ($335 million).