Published: October 29, 2024, 12:08h.
Last updated on: October 28, 2024, 12:13h.
The Chinese Special Administrative Region (SAR) of Macau has intensified regulations to combat illegal gambling in the casino enclave.
Earlier this month, legislators in the Macau Legislative Assembly approved the Law to Combat Crimes of Illegal Gambling. Assembly President Kou Hoi In and Chief Executive Ho Iat Seng subsequently signed the statute.
The illegal gambling law officially took effect today, Tuesday, October 29, after being published in the Macau Official Gazette. This publication serves as the primary source of newly enacted laws in the city.
The law specifically prohibits online gambling within the SAR and imposes harsher penalties, including up to six months in prison for participants in illegal gambling and up to eight years for operators of illegal gambling activities.
Furthermore, the law prohibits providing loans to gamblers with the expectation of sharing in any winnings, with violators facing up to five years in prison. It also prohibits residents of Macau from playing the Hong Kong Lottery and the popular Mark Six game.
Currency Exchanges Targeted
One key aspect of the law is the prohibition of “under the table” bets and the criminalization of unlicensed money exchanges.
Under-the-table bets involve high rollers making off-table bets against an external “house,” typically a junket. Such bets have cost the Macau government over $1 billion between 2013 and 2021, prompting law enforcement action and the drafting of the illegal gambling legislation.
Of significant concern to the casino licensees is the crackdown on illicit money exchange networks facilitating illegal cash transfers from the mainland to Macau.
To circumvent China’s restriction on entering Macau with more than $5,000 in cash, high rollers have relied on electronic payments to money exchange groups in Macau. These groups then provide the funds, minus a service fee, upon the gamblers’ arrival in Macau.
The statute stipulates that anyone who exploits currency exchange for gambling purposes without legal authorization may face up to five years in prison.
Macau’s Judiciary Police is increasing its monitoring of financial transactions within the region. Recently, 42 mainland residents were handed over to Chinese authorities for allegedly engaging in unlicensed currency exchange activities.
New Regulatory Environment
With efforts to restrict the movement of large cash sums from the mainland to Macau, casino resorts are shifting focus to mass and premium mass gambling demographics. They are investing in non-gaming attractions to improve occupancy rates and overall revenue.
Despite a 31% increase in gross gaming revenue in the first three quarters of 2024 compared to the previous year, revenue remains 23% below pre-pandemic levels from 2019.