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Macau's Tighter Gaming Credit Law Picks Up Steam in the LegislatureChina’s Special Administrative Region is working to update its gaming credit regulations to keep the gaming scene’s financials in check. Here’s all you need to know about the new laws that just passed the first reading in Macau’s legislature.
The gambling capital of the world, Macau, is seeking to beef up its gaming credit laws. The first notable move toward the new gaming credit law was initiated on Thursday when Macau lawmakers gave their first nod of approval to the bill. The said bill, which has undergone amendments since April, was passed unanimously by the Legislative Assembly. It is now set to go to the Legislative Assembly Committee where it will face additional scrutiny.
Discussing the gaming credit law, Macau’s Secretary for Economy and Finance, Lei Wang Nong, revealed that the new bill would not change much in the running of the critical sector in Macau. He instead referred to the bill as a ‘technical adjustment’, stating that it is the Chinese Special Administrative Region’s (SAR) government's way of developing a healthier gaming credit business.
Although the proposal is only in its infancy stages, it’s already drawn opposition from some quarters in Macau’s legislature. One of the most vocal opposers of the new gaming credit law is legislator Jose Pereira Coutinho who feels that the regulations come at the worst possible time – when Junkets in the region have been facing a torrid time in business. Warning that junkets are sinking, the legislator opined:Quote
“Maybe the next time we see the Finance secretary there will only be three gaming junkets left. Does the government want to see this happen?”
Dissecting the Gaming Credit Law
During the bill’s initial reading, lawmaker Ron Lam U Tou pointed out that under this new gaming credit law, gaming operators will be inculcated into the Credit Data Platform. The Credit Data Platform is a system employed by banks to store credit information. Ron emphasized the validity of this move by adding that the integration would lead to a greater understanding of credit issues related to junkets and concessionaires. Additionally, he noted that the Credit Data Platform is a well-established system aimed at protecting the region’s financial structures from potential threats.
Unlike the existing gaming credit regulations, the Macau government is seemingly changing its previously held stance by allowing only concessionaires to issue credit. As such, all the casino operators will forthwith be banned from issuing gaming credit, and should they do so, they face hefty fines stipulated under the bill. However, the bill, if passed into law, allows for licensed junkets to enter into contracts with concessionaires, which would see them being allowed to issue gaming credit.
Concerning the supervisory directions, there’s no huge change when you compare the legislative proposals to the present gaming credit laws that came into effect in 2004. The real difference comes in Article 8 of the bill which introduces three key gaming credit requirements for concessionaires and junkets as follows:
- Come up with a system to control credit risk.
- Duly handle credit business by maintaining and constantly updating their records and instituting effective security measures to protect consumer gaming credit data.
- Develop mechanisms for addressing customer complaints about gaming credit.
Mind you, even though the new bill may seem like a major overhaul, when you look at the fine print, you realize that there hasn’t been much of a shake-up policy-wise. Perhaps the major shift in this version of the gaming credit law, is that what was previously viewed as regulations, has now been transformed into law. The legislators are basically formalizing what was in existence before.
DICJ to Oversee Gaming Credit Activities in Macau
Should the bill become law, Macau’s Gaming Inspection and Coordination Bureau (DICJ – Portuguese acronym) will be handed the authority to oversee the concessionaires' and junket's credit activities. These powers extend to the DICJ monitoring these credit activities without the need for issuing any prior notice.
On that, the bill explicitly states that the DICJ’s officers should unequivocally be granted access to the concessionaires’ and junkets’ physical locations, so they can discern whether these entities are complying with the gaming credit law.
Penalty Scheme For Non-Compliance
Concessionaires and junkets found to be contravening the new gaming credit law are to be slapped with stiff penalties when the law comes into effect.
If a concessionaire is found guilty of conducting credit business via proxies or any other entities, they will be handed a fine of between MOP 2 million ($248,000) and MOP 5 million ($620,000). Additionally, any concessionaire found to have transferred credit qualifications to any other person will receive similar penalties.
Junkets on the other hand face a fine of between MOP 600,000 ($74300) and MOP 1.5 million ($186,000) should they be found guilty of the regulatory failures highlighted above.
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