Macau’s Legislative Assembly has unanimously passed a new gaming credit law, which will come into effect on 1 August this year.
The new law, officially the “Legal regime for granting credit for games of chance in casinos”, was first passed by the Legislative Assembly on 18 May last year. The Second Standing Committee of the Legislative Assembly, after nearly a year’s discussion, passed the final [detailed] vote on Friday.
The law stipulates that gaming credit can only be issued by Macau’s six concessionaire, and that junkets cannot issue credit. They can, however, an agency contract with a concessionaire to borrow money on the concessionaire’s behalf, with chips lent and recovered belonging to the concessionaire all along.
When the law was first announced by the Executive Council, there was still a provision allowing junkets to carry out lending activities, but this provision was deleted during subcommittee discussions.
The new legislation provides for the Chief Executive to disqualify a concessionaire from issuing credit if it is deemed to be in the significant public interest but does not specify what constitutes such significant public interest.
Penalties have also been substantially increased. If a concessionaire fails to set up a credit risk regime, establish a credit record system and a sound customer complaint mechanism, or if it transfers its credit eligibility to another person in any form, it is liable to a fine of between MOP$2 million and MOP$5 million.
If a gaming junket violates the relevant ordinance, it is liable to a fine of MOP$600,000 to MOP$1.5 million.
The Secretary for Economy and Finance, Lei Wai Nong, said, “The law has stipulated that when the grantee company is borrowing money, they have to make a risk assessment and regulate the management of this, as well as record the information, which is regularly supervised by the DICJ.”
IAG previously interviewed representatives of Macau junkets about the law, whop generally believe they will be heavily impacted.
“If a new client wants to borrow, we (gaming junkets) can only refer it to the grantee company, but the grantee company needs to re-approve the client, and this may take some time,” one rep said.
“This will undermine the need for gaming junkets. If the customer feels that the concessionaire can lend, why would he or she need to go to a gaming junket?”
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