Junket operators in Macau sharply declines
The number of junket operators in Macau continues to slide, with the local government revealing that there has been a 45.9 per cent drop in the number of junkets in the past 12 months alone.
GGR Asia reports that in January 2021, there were 85 junkets operating in Macau.
That figure has reduced to just 46 a year later, according to the latest updated list of licensed operators published by the city’s gaming regulator, the Gaming Inspection and Coordination Bureau.
Some of the major junket brands in the Macau market, Tak Chun, Meg-Star International and Golden Group, remain in this year’s list of licensed entities.
The gaming regulator did not provide in its latest announcement an explanation for the decrease in licensed junkets.
Around January each year, the gaming regulator publishes in Macau’s Official Gazette a list with the names of all junkets licensed to operate in the city’s casinos.
Back in January 2013, Macau had 235 licensed junkets, according to the data.
Alvin Chau arrest and fall of Suncity leads to junkets’ downfall
Macau’s casino junket sector has been in the spotlight in recent months since the detention of promoter Alvin Chau in November.
His junket brand Suncity, described by analysts as the largest VIP operator in the city has been shut down.
Following the closure of all Suncity Group VIP rooms in Macau on December 1, it was reported that a number of the city’s casino concessionaires were to cease collaboration with other junket brands.
At least three of the city’s six operators – Wynn Macau, Melco Resorts and Galaxy Entertainment – have confirmed that junkets had ceased operations at their respective properties in Macau.
A bill to amend Macau’s gaming law also addresses fresh regulation for the city’s junkets.
According to the document, each Macau junket will only be allowed in future to work with a single Macau concessionaire.
In addition, junkets will be forbidden to contract use of any part of a casino for operations in their own right.
They will also be forbidden to share casino revenue, in any form or via any agreement, with any gaming concessionaire they work with, the draft bill says.
In Macau, junkets have been historically offered incentives to bring players to casinos, usually either via a share of the revenue generated, or via a commission on rolling chip turnover, with the latter customarily capped at 1.25 per cent.
For the full year 2021, VIP gross gaming revenue accounted for nearly 32.8 per cent of aggregate casino GGR in Macau at US$3.55 billion.
That was down from a 43.5 per cent market share in the prior year.
In the three months to December 31, VIP accounted for just 25.7 per cent of Macau’s aggregate GGR for the period.
Macau casino re-tendering process laid out
All existing or potential Macau concessionaires will have to proceed through a new tender process to be awarded a concession and that the concept of sub-concessions will be discontinued.
The news suggests Macau’s six current concessionaires are well positioned to be granted new licences once the upcoming re-tendering process is complete.
It remains unclear whether re-tendering will take place before 26 June 2022 or if the current concessions, due to expire on that date, will be extended.
Instead, government representatives Cheong Weng Chon, Secretary of Administration and Justice, Ku Mei Lang, Chief of Staff for the Office of the Secretary for Economy and Finance and Ian Lin, Advisor to the Office of the Secretary for Economy and Finance, said the current licences would be extended for only a “short term” if re-tendering cannot be completed in time.
Cheong, Ku and Ian did confirm some other details around amendments to Macau’s gaming law, including a minimum capital requirement for concessionaires of MOP$5 billion and a requirement for a Macau-based managing director to hold a 15 per cent interest in the company (formerly 10 per cent).
A proposal to appoint a government representative to the board of directors of each concessionaire will not be implemented.
