Macau casino concessionaire Sands China says it broadly supports a planned amendment to Macau’s gaming law that could see operators lose gaming tables or electronic gaming machines (EGMs) if they fail to meet annual revenue targets.
According to details contained within the draft bill “Amendment to Law No. 16/2001 – Legal framework for the exploitation of games of chance in casinos” – published by the Legislative Assembly (AL) last week – each concessionaire will be allocated a cap on the number of gaming tables and gaming machines it is authorized to operate.
However, the government will also set a minimum annual limit of gross income from each gaming table and gaming machine, a figure that will seemingly be based on GGR. If this minimum annual income is not reached, the concessionaire will be required to make up the difference and if not reached for two consecutive years, the Chief Executive may reduce the number of tables or machines authorized for use.
Asked specifically about this amendment during Las Vegas Sands’ 4Q21 earnings call on Thursday morning (Asia time), Sands China COO and Executive Director Grant Chum said the company “welcomes the direction of linking table allocation with productivity,” adding, “In general, we’ve always efficiently used our table allocation.”
While Sands China was careful not to address other specific aspects of the draft bill, noting that it remains a work in progress, Chum also praised the government’s efforts in expediting preparations for license re-tendering in recent months.
“I think the key aspects of the legislation have been laid out in terms of the number of concessionaires and the duration of the future concession although there are a lot of aspects that continue to be worked out through the legislature,” he said. “It has passed the first stage of the Assembly and is now moving to the committee stage.
“It’s still in draft form but we appreciate the progress that has been made so efficiently and so rapidly since the public consultation – only a short four months since that time and we are already going into the committee with the draft. The government has done an outstanding job in getting us to this stage so quickly with a lot of preparatory work being clarified. But it’s still draft legislation and we await the outcome in the coming months. I think we need to wait for further details in terms of the finer form that the amendments will take.”
LVS Chairman and CEO Robert Goldstein made it clear that Macau remains the focus of the company’s plans moving forward, despite ongoing conjecture over possible expansion efforts in the United States, including in the sports betting and iGaming space.
“We’ll continue to evaluate if there is an entry point there that makes sense for LVS but we remain consistent – our bread and butter is still going to be Asia and land-based,” he said.
“You can’t replicate a US$5 billion business which we think will come back next year. That’s our first point of business.
“We continue to be very bullish on the Macau market despite the past 20 months and we like what we see with the re-tendering process.”
