Saipan casino investor Imperial Pacific International says its local subsidiary, Imperial Pacific International (CNMI) LLC, has filed an administrative request for the Superior Court in Saipan to conduct a judicial review into the indefinite suspension of its casino license by the Commonwealth Casino Commission (CCC) of the Northern Mariana Islands.
The CCC suspended IPI’s license in April following a series of complaints against it for failure to comply with certain requirements under its license agreement.
Those complaints related to IPI’s failure to pay its annual US$15.5 million license fee last August, failure to pay its annual US$3.1 million regulatory fee in October, failure to contribute US$20 million to the community benefit fund in both 2018 and 2019, failure to comply with its minimum US$2 billion capital requirement and failure to comply with a CCC order to pay all money owing to its vendors.
IPI was also given six months from April to repay both the US$15.5 million casino license fee and US$3.1 million regulatory fee, as well as a US$6.6 million fine, or risk having its license revoked.
However, IPI said via an announcement on the Hong Kong Stock Exchange late Tuesday that it had filed the review with the Superior Court due to differences of opinion between it and the CCC over payment of the annual license fee given the impact of COVID-19 on its operations.
The casino at Imperial Palace‧Saipan has been closed since 17 March 2020 and international flights into Saipan remain suspended.
“Pursuant to the force majeure clause under the Casino License Agreement, the Licensee is not required to pay the Annual License Fee in the event of natural disasters,” IPI said. “However, the Commonwealth Casino Commission raised disputes and alleged that the pandemic does not constitute a natural disaster or force majeure.
“As a result, the Licensee has filed a review with Superior Court in Saipan to determine whether the pandemic constitutes a natural disaster or force majeure. If it is determined that the pandemic constitutes a natural disaster or force majeure, the Licensee will not be required to pay the Annual License Fee.”
It is not clear whether a finding in IPI’s favor would result in the license suspension being overturned given the range of complaints against it.
IPI, whose majority shareholder Cui Li Jie stood down as chairman last week, recently announced a US$367 million loss for FY2020.