Japan casino legislation finally approved by Diet’s upper house


japan-casino-legislation-approvedJapan’s casino bill has cleared the legislature’s upper house despite a flurry of last-minute procedural tactics by opponents of gambling expansion.

On Friday, the final day of the Diet’s current legislative session, the House of Councillors formally approved the Integrated Resorts (IR) Implementation Bill. The bill’s passage marked the climax of a multi-year process that faced innumerable obstacles, including a majority of the Japanese public that remains deeply skeptical on the merits of gambling expansion.

The bill calls for a maximum of three large-scale gaming venues to be constructed in cities that have yet to be determined. After the first IR location has been established, a seven-year clock will start, after which the government will review whether to permit the construction of additional IRs.

The first licenses aren’t expected to be issued until 2020, while the expected scale of these projects mean the first casino isn’t likely to open for another five years after that.

In late 2016, Japan passed legislation amending the country’s constitution to permit casino gambling. But political upheaval and public skittishness poured molasses on the IR Implementation Bill’s path to passage.

In May, the Diet approved a companion bill containing provisions to mitigate the potential harms of casino gambling. The government’s recognition of the public’s ongoing uncertainty regarding casinos is reflected in the strict conditions imposed on both the public and the companies that are fortunate enough to win the highly coveted IR licenses.

Japanese gamblers face casino entry fees (not applicable to foreign gamblers) and limits on the frequency of their casino visits (monitored through the use of national identity cards).

Casino operators will be required to cap their gaming floor space at no higher than 3% of a resort’s total footprint and will pay a hefty 30% tax on gaming revenue. International operators may also potentially be limited to minority partner status in joint ventures with local companies.

Still, better half a fish than no fish at all. The IR Bill’s passage will only intensify the lobbying knife-fight that is already being waged behind the scenes by international operators eager to plant their flag in a casino market that could ultimately rival Macau in terms of gaming revenue.