Inside Asian Gaming

43 July 2013 | INSIDE ASIAN GAMING REGIONAL BRIEFS at a recent session of the National Assembly, Nguyen Thi Kim Yen said casinos already are paying “very considerable” corporate and consumption taxes and warned that the additional tax will drive foreigners away. The country’s eight casinos are growing revenues at a robust annual average of 10-15% a year, according to the Finance Ministry. They paid VND1.5 trillion in total taxes (US$72 million) in 2011. The casino at the Lao Cai International, owned by Donaco Singapore, is paying upwards of $10 million a year in tax (VND100 billion-200 billion), Ms Yen said. Donaco is controlled by family members of Genting Group Chairman Lim Khok Thay. Caesars, Okada Rejected in South Korea The government of South Korea has denied the casino license applications of Caesars Entertainment and its partner Lippo Group, as well as Kazuo Okada’s Universal Entertainment. The Ministry of Culture, Sports and Tourismgave no reasons for the decisions, according to a Reuters report, but a government official with knowledge of the matter told the news agency the decision reflected concerns about Las Vegas-based Caesars’ credit rating. Moody’s Investors Service lowered its ratings on the company and assigned a negative outlook in April, citing adverse gaming revenue trends. Lippo, an Indonesian conglomerate, has holdings across East Asia in retail, banking and finance, media, real estate, hospitality, energy, IT and health care. The consortium said it was “surprised and disappointed” and believed it had met the license requirements. The partnership had applied in January for permission to develop a mixed-use resort with gaming in an area designated by the government for development near the international airport in Incheon, not far from the capital of Seoul. Six of these so-called “free economic zones” have been set up around the country to spur domestic and foreign direct investment via tax breaks and other benefits. Foreign tourism is seen by South Korea as a growth industry with special promise, and officials appear to want to encourage its development. The Incheon FEZ is considered a key to this effort because of its proximity to China. The government has approved one resort casino for Incheon to date, a joint venture between Paradise Group, one of the country’s leading operators of foreigners-only casinos, and Japanese pachinko giant Sega-Sammy. Universal, a machine gaming giant with subsidiaries worldwide and casino plans in the Philippines, was not immediately available for comment. The company’s Philippines ambitions, centered on development of a multibillion-dollar resort in Manila, have stalled over bribery allegations that are under investigation by the country’s National Bureau of Investigation and the US Justice Department. Mr Okadawas ousted as a director andmajor shareholder ofWynn Resorts after an in-house investigation found what it considered evidence of wrongdoing related to the Manila development. Universal and Mr Okada are challenging those findings in a lawsuit in the United States. The company also strenuously denies the bribery allegations. Okada Clears Philippines Hurdle Though thwarted in South Korea, Kazuo Okada appears to have overcome an impasse in the Philippines. His search for new local partners there has uncovered a couple of unnamed groups reported to be interested in helping the Japanese machine gaming tycoon move forward with his planned megaresort in Manila. Eagle II Holdings, the landowner operating under the umbrella of Mr Okada’s Tiger Resort Leisure and Entertainment, said it has concluded a memorandum of understanding with the two entities to sell them 60% of Eagle II, thereby enabling Tiger to satisfy the country’s 40% limit on foreign ownership. Mr Okada’s original partnership with Philippine property giant Robinsons Land fell apart earlier this year after the two failed to agree on terms. Tiger President Masahiro Terrada told The Philippine Star the entry of the two companies will allow the group to complete its Entertainment City Manila resort on schedule in the first quarter of 2015. Manila Bay Resorts, as it’s called, is slated to include three hotels with a total of 2,000 rooms, a casino, restaurants and high-end retail, cinemas, MICE space and other attractions. Its cost is pegged at US$2 billion, about half of which includes a luxury residential component to be developed in partnership with Philippine real estate tycoon Andrew Tan. The new Grand – Ho Tram Strip Kazuo Okada Rendering of Kazuo Okada’s planned Manila megaresort