Macau casinos will be bridled by new rules

Macau casinos predict an "earthquake" in the regulatory framework - the updated law will tighten the regulation of the gambling market.

Macau casinos that have survived the coronavirus are approaching their next bifurcation point. This implies the news about a 45-day period of consultations of specialists from the financial and economic block of the government, who are going to discuss the consequences of the revision of the rules for regulating the gambling market. The reason was the start of trading for licenses, which for most casinos will expire next June.

The entire market structure is proposed to be divided into nine zones, imposing stricter rules on the casino. The key factor will be the reduction in the number of licenses. The large number of the latter is viewed by officials as a road to unfair competition.

Other suggestions include:

• reduction of the term of "work" of licenses;
• introduction of additional protection measures for employees;
• strengthening verification activities for junket operators;
• introduction of stricter requirements for operators;
• promotion of the theme of non-game elements;
• increasing social responsibility;
• building up the list of violations that fall under criminal responsibility.

The market has already responded to government initiatives with a drop in shares - Wynn Macau lost 34%, Sands China - 28%, Galaxy Entertainment, Melco Entertainment, SJM - slightly less. Market analysts are foreshadowing margins crushing and casinos falling.

The profitability of Macau casinos was crippled by the August fight against the coronavirus, experts say, and now the innovations will scare away investors. The consequences for the casino are disastrous.