Inside Asian Gaming

INSIDE ASIAN GAMING | July 2012 44 Briefs Regional Briefs plans to build a casino by a 57% to 43% margin. The vote is expected to attract the interest of America’s major casino operating companies, all of which are seeking opportunities throughout Asia, especially given Taiwan’s close proximity to China and its gambling- hungry masses. In all likelihood, however, the bulk of revenue at any future casinos in Matsu are likely to be generated by Taiwanese citizens. Taiwan’s casino properties could also hardly hope to compete with those in Macau, where billions of dollars have been invested since the liberalization of the industry in 2002 to create a string of dazzling resorts. Even ifTaiwan eventually builds its ownmoremodest casinos, Taiwan’s highest-rollers may still continue traveling to Macau to get their gambling fix. Taiwan currently has around 3,000 electronic game arcades offering quasi-gaming, in a similar fashion to Japan’s pachinko industry. While pachinko itself remains popular in Taiwan—a legacy of the Japanese occupation in the early 1900s—the country’s restricted rate arcades have come to be dominated by slots and multi-player machines offering baccarat, sic bo and roulette. Bingo also still enjoys a strong following in Taiwan, particularly among the older generation. The legal grey-area under which the restricted rate arcade market operates has probably not helped the public perception of gaming in Taiwan. Despite their less-than-ideal operating environment, the restricted rate arcades are estimated to generate over US$5 billion annually. That suggests plenty of pent-up local demand for legal gaming to support an ambitious casino venture, even if, as many fear, mainland China blocks its citizens from playing at Taiwan’s proposed casinos. According to Union Gaming Group Principal Grant Govertsen, legalized gaming in Taiwan is at least five years away. “We believe that much needs to be done before the request for proposal process can begin,” Mr Govertsen said. “The voter referendum now sets off a chain of legislative events that will likely need to come to fruition.” Taiwan will need to process two separate bills, including a casino law bill and an integrated resorts bill. Mr Govertsen said a “safe estimate”with respect to timing would allow a year or more for the implementing legislation to be worked out and then another year for the RFP process. “As such, we would not expect integrated resort construction to begin until sometime in 2014,” Mr Govertsen said. “Given the typical integrated resort build cycle of three years, we think 2017 is the earliest any integrated resort in Taiwan will open.” Gambling is illegal in Taiwan but an amendment passed in 2009 permitted building casino resorts on offshore islands. Matsu is home to 8,000 people and is a 30-minute ferry ride from China’s Fujian province. Residents in favor of a casino resort said gaming would boost infrastructure and help develop the islands’ tourism industry. Matsu is one of the smallest of the offshore island groups that the Taiwanese government has enabled to vote for casinos in local referendums. In 2009, residents of the Penghu Islands off the western coast of Taiwan rejected plans to build a casino there. Mr Govertsen does not expect Matsu to build more than two integrated resorts, and as such it is unlikely to pose much of a competitive threat to Macau. “Without a concentration of casinos, which give customers numerous gaming options, we would think Concern over Vietnam slot malfunction hearing When a computer glitch at a bank results in funds being mistakenly credited to a customer’s account, there is no question that the customer has no claim to those funds, which are subject to retrieval by the bank. While banks and ATMs do not display clear disclaimers that customers are not entitled to funds wrongly credit to their accounts through computer error, slot machines almost always prominently display the caveat “ malfunction voids all pays and plays .” Such a disclaimer appeared on all the machines at the Sheraton Saigon Hotel’s Palazzo Club in Ho Chi Minh City, where Ly Sam, a Vietnamese American, claims to have won big at a slot game in October 2009. The same disclaimer was also inscribed on a metal plaque on the wall next to the reception desk as part of the club’s rules. Images of the game screen immediately before and following Ly Sam’s purported win show no win registered on the win meter, and no matching symbols appearing on adjacent reels in any of the designated lines. BMM Australia, an independent gaming testing laboratory, verified the machine had malfunctioned, adding the slot machine in question offered a maximum possible win of US$7,500 given a bet denomination of US$0.1—the denomination of Ly Sam’s game. The malfunction is thought to have resulted in electricity fluctuations caused by an outside power source issue. This is not the first time a slot malfunction has mistakenly credited a large sum to a player in Vietnam, but it is the first time the authorities have deemed to entertain the case in court. A hearing is scheduled to take place this month at the People’s Court of District 1 to determine whether to award Ly Sam his claim. If it does, it could set a dangerous precedent and give pause to Vietnam’s would-be foreign investors in the gaming and tourism industry and beyond. Taiwan casinos could be at least five years away Residents on a small group of Taiwanese islands approved a casino referendum on 7th July, paving the way for Taiwan’s first legal gaming establishment. The Matsu island chain of Taiwan approved the government’s Ripe for development—Dongju island, part of the Matsu island chain