Inside Asian Gaming

INSIDE ASIAN GAMING MAY 2018 20 It seems inevitable that the government will initiate a public tender requiring all six concessionaires and any other interested parties to state their case to be granted a new Macau gaming license from 2022. gaming licenses and the as yet unknown license renewal tender or re-licensing process set to ensue. For those too young to recall, it was November 2001 when the government – keen to end Stanley Ho’s 40-year monopoly on casino gaming in Macau – called for applications for three gaming licenses to be awarded in the tiny Chinese enclave. The three winning bids were Dr Ho’s SJM, Wynn Resorts and a joint venture partnership COVER STORY between US casino operator Las Vegas Sands (LVS) and Hong Kong construction firm Galaxy Entertainment Group. As it turned out, the LVS-Galaxy venture quickly soured and rather than endure a battle over who should claim the license, Macau’s government instead invented the concept of a “sub-concession” – thus, Galaxy retained its license while LVS essentially became Macau’s fourth licensee by claiming the sub-concession. The same sub-concession arrangement was offered to SJM and Wynn as well, opening the door for MGM Resorts, who partnered with Dr Ho’s daughter Pansy, to claim SJM’s sub-concession while Melco-Crown – a partnership between Dr Ho’s son Lawrence and James Packer’s Crown Resorts – bought Wynn’s. Fast forward almost 20 years and all six concessions are nearing their expiration, starting with SJM and MGM in 2020 then the remaining four operators in 2022. So what happens now? It’s a question that has been posed many times over the years and is one that doesn’t come with a simple answer. The first possibility is a brief license renewal. Under Macau Law No 16/2001, “the duration of the concession may exceptionally be extended by reasoned order of the Chief Executive by one or more times, not exceeding in the aggregate five years.” It is because of this law that many experts predict both SJM and MGM will have their licenses extended through 2022 to bring Las Vegas Sands led the move to Cotai with construction of the Venetian Macao after claiming Macau’s first sub-concession.