Korea’s Board of Audit and Inspection (BAI) has revealed a request has been made to Kangwon Land to restrict the maximum number of days any one customer can enter the casino each year to 100.
Details of the request were outlined in the BAI’s regular audit report, according to Yonhap News Agency, which claimed, “The effectiveness of measures to prevent gambling addiction, such as the access restriction system, are insufficient.
“The National Assembly has requested Kangwon Land reduce the number of days of casino users to less than 100 days a year to prevent the occurrence of high-risk customers who enter the casino excessively.”
Under the current system, customers can gamble 148 days each year, with restrictions around how many days are permitted in consecutive months or consecutive quarters.
The new measure reduces that cap by 32%, however JP Morgan analysts said Friday the change should have little practical impact on Kangwon Land’s profitability.
“First, this isn’t really new news,” wrote analysts DS Kim and Livy Lyu in a note.
“BAI had, back in 2016, asked Kangwon Land to limit a player’s annual visits to 100 days. This is why Kangwon Land had imposed the current scheme from 2017 via a monthly visit cap, although [a] loophole allows a player to visit up to 148 days in a year.
“Second, those visiting Kangwon Land more than 100 days a year accounted for only about 0.3% of total players even before COVID.
“Third, this was merely a reiteration from BAI’s regular audit; hence it may not signal the overall direction of the government’s policy, in our view. In short, we view this headline as largely a non-event.”
Kangwon land was last year granted a 20-year extension to its casino license until 2045 in return for a greater slice of its revenue pie, with the 25% tax on profit changed to a direct 13% tax on GGR, effectively increasing the rate charged on profit to around 31% on a like-for-like basis.
Located 150 kilometers (93 miles) from Seoul, Kangwon Land was borne out of Korea’s conversion to gas and oil for energy, leading to the closure of mines in Gangwon province in 1989.
Legislation in 1995 encouraged redevelopment of abandoned mining areas, prompting local, provincial and national authorities to found Kangwon Land Inc, which is 51% government owned and overseen by the national Ministry of Knowledge Economy.