Macau government awards six gaming concessions, VML among concessionaires

Macau's government said on Saturday 26 November 2022 that its six incumbent casino operators would receive provisional awards of new 10-year gaming concessions, with Malaysian operator Genting missing out¹. The list was published in an executive order by the Chief Executive gazetted that day². The concessions begin in January 2023².

The provisional winners, listed in the order of the score the tender committee assigned, were MGM Grand Paradise Limited, Galaxy Casino Company Limited, Venetian Macau Limited, Melco Resorts (Macau) Limited, Wynn Resorts (Macau) Limited and SJM Resorts, Limited². MGM Grand's bid received the highest score and SJM Resorts the lowest among the six successful bidders, the committee said, without disclosing the scores or the breakdown of criteria². The committee carried out five rounds of negotiations with the seven bidders and assessed bids on three main criteria: ensuring the stability of local employment, exploring overseas markets, and development of non-gaming offerings². The same three considerations were cited at the government's news briefing¹.

Andre Cheong Weng Chun, chairman of the tender committee and Secretary for Administration and Justice, said of the losing bidder:

The government said it aimed to finalize the new contracts before the end of 2022 so the concessions could begin in January 2023 as scheduled². The previous concessions and sub-concessions expired at the end of that year¹. On 26 November 2022 the government made provisional awards to six bidders including VML, subject to conditions including a bank guarantee of MOP1,000,000,000; VML met all conditions by 9 December 2022³. On 16 December 2022 the government awarded six concessions and VML entered into a concession contract³. The bank guarantees, including the MOP2,310,000,000 one, were released in January 2023³.

Melco Resorts & Entertainment said it was awarded a ten-year concession to operate games of fortune and chance in Macau casinos, through subsidiary Melco Resorts (Macau) Limited, with the term commencing 1 January 2023⁴. The US State Department describes the awards as six 10-year concessions, including to the three incumbent local subsidiaries of US firms, and says the six concessionaires agreed to invest a total of about $15 billion in Macau over the next ten years, 90 percent of which must be used for non-gaming projects and attracting international visitors⁵. It also says the concessionaires later increased their non-gaming commitment by 20 percent under an agreement with the government that should gross gaming revenue surpass $22.5 billion⁵. Credit Suisse said in October 2022 that the government required each new concessionaire to invest between HK$10 billion (US$1.28 billion) and HK$20 billion in the city over the next 10 years².

What it means for players

The six operators running casinos in Macau keep running them. The properties named in the awards, including Venetian Macau's Venetian, Londoner, Parisian, Plaza and Sands Macau resorts, continue under the same corporate groups, so the practical line-up of casinos in Macau is unchanged for locals, expats and visitors. The award is a licensing decision, not a change to game rules, table limits or entry requirements, none of which are set out in the announcements. The government's stated criteria include developing overseas tourist markets, which points to a continued push for non-mainland visitors, but no specific measures affecting players were reported. The new law governing the concessions, described as banning junket operators, was expected to pass in December 2022⁶; the effect on individual players is not detailed in the announcements. For how concessions and other license models differ, see types of gambling licenses, and for how licensing is checked, see gambling regulators and licenses.

What happens next

The government was to negotiate contract details with the six provisional winners and finalize and sign the concessions before the end of 2022, so operations could start under the new terms in January 2023². The new gaming law covering satellite casinos and junkets was expected to be passed in December 2022⁶. Whether GMM could partner with any of the six operators was described as a commercial decision, with any major shareholding change requiring government approval².