Inside Asian Gaming

INSIDE ASIAN GAMING | May 2011 20 was appropriate. The issue is did they give it sufficient thought? For example, if a manufacturer has jackpot bonuses on his electronic sic bo product that aren’t allowed on a live table, does that mean those bonus features have to go as well? And does this ruling stop at sic bo , or could it be applied to other games such as video card games, baccarat andboth video and fully automated roulette?” asks the supplier. The supplier adds that even if the DICJ’s aim is to standardise pay outs on all derivative forms of table sic bo , there’s an additional problem. Table sic bo in Macau has variations. “There are at least two layouts for table sic bo with different odds and not all winning combinations are availableonvarious tables,” says the supplier. The person adds other suppliers also feel the incident is evidence that the Macau industry is not the three-way partnership between the government (represented by the regulator), the casino operators and the equipment makers that they had hoped for at the time of market liberalisation back in 2002. Some are frustrated in particular by the fact they cannot make representations or provide information about their products directly to the local regulator, but instead must rely on the operators to make the case for them. The suppliers worry that while operators act in good faith in their advocacy role, their knowledge of the products may not be as detailed as that held by the manufacturer. Because slots and electronic games only generate a small percentage of their total revenues in Macau, casino operators are naturally likely to focus most of their diplomacy and lobbying efforts with the government and DICJ on protecting their interests in the live table segment. Only 4.7% of gross revenue for games of fortune in Macau came from slots and electronic games in the first quarter of this year. At theheart of theproblem is that—more than nine years after market liberalisation— the government has not promulgated a regulation dealing with electronic gaming machines. This means there is no basis in law for the DICJ to have a regulated relationship with equipment makers; only with the concessionaires and the junket operators. That’s why the DICJ doesn’t get involved in direct communication with, and submissions from, manufacturers. Product approvals must be conducted through the concessionaires, since they are the entities over which DICJ has regulatory jurisdiction. IAG approached the DICJ for a comment on the lack of electronic regulations in Macau and the other points raised in this story. At the time the magazine went to press, no comment was available. In return for the valuable right to ply their lucrative trade, casino operators and casino equipment suppliers are occasionally required to accept gaming law decisions they don’t especially like. Other sources point out that Macau does have published regulations for table games, and that those regulations include sic bo , albeit under another name. “Under Law 16/2001 [Macau’s general legal framework for the local gaming industry] sic bo is listed under Article 3,3 as a table game, under the name ‘ cussec’ ,” explains a gaming law expert. “My view is that since a machine version of a table game—e.g. sic bo —is a derivative of that table game, there can be no case for differential odds. The markets for machine and table games are, in my view, quite different, and will remain so. You may well ask why there is a slot machine market at all in Macau, never mind one generating US$1 billion in annual revenue, given there is no regulated minimum return to player on slots. The point is, I suppose, that people’s game preferences are not necessarily driven by the odds offered. If that were not the case, everyone would be playing baccarat,” adds the gaming law expert. A supplier speaking to IAG on condition of anonymity backs the gaming law expert’s view that if a product has a live dealer it should be considered a live table—but differs from the gaming lawexpert regarding the best fix for the issue. “The DICJ’s position on live dealer automated sic bo makes sense,” said the source. Definitions “I think what they should say is any game with a dealer is a live game irrespective of how many terminals it’s got, and anything that’s fully automated is a machine,” says the supplier. Crucially, however, the supplier adds: “I think the DICJ should have stuck to its guns, rather than forcing the rest of the market to fall in line with Sands China’s Rapid Sic Bo product. “If Sands China didn’t like its live dealer automated games being regulated as table games, it should have potentially applied to the DICJ for amendment of the rules whereby they [the operator] could pay out different values. The DICJ then could have taken a view. I think all the controversy has forced the DICJ to take an overall view which I think encompasses elements that are Cover Story Mixed reception—the sic bo ruling leaves some unhappy Sic bo regulation—more questions than answers?