A couple of casino operators in Macau are seeing their license concession expiration dates approaching rapidly. There are two that are expected to end next year and Macau still hasn’t determined how it will handle the renewal process. One of the firms looking at the end is SJM Holdings and its CEO has now confirmed that it still hasn’t discussed the subject of an extension with the city’s government.
SJM’s current concession expires in March of next year. If it expires without any type of extension or renewal, the company’s operations would not legally be able to remain open. Its latest offering, a new casino in Cotai, isn’t expected to be ready until the end of this year, potentially giving SJM a break in Macau revenue generation.
SJM CEO Ambrose So Shu Fai recently attended a Chinese New Year banquet hosted by the company in Macau and was asked about the extension. While the executive has previously indicated that the company would like to see an extension of the concession in order to put the expiration date parallel to that of four other operators in the city, he said that there has still been no such request made. He explained nonchalantly, “We have not done it now. We can do it tomorrow. We can do it the day after tomorrow.”
A reporter inquired as to why the company has not made a move, to which So replied, “We choose our time and when we do it. It is not for you [the media] to ask me when to do it … We will apply within the time limit. We are still complying with the law.”
The subject of the concessions and licenses has been a little problematic. According to gaming laws in Macau, a gaming concession cannot be awarded for a term of more than 20 years. It further states that if a concession is given for a term of less than 20, an extension can be granted as long as the entire length of the concession doesn’t exceed the 20-year term.
SJM’s concession is for 18 years and, in order for it to expire parallel to the others, it would have to be extended until 2022 – two years more than the law allows.
There have also been concerns that a “renewal” of concessions after 20 years may not be permitted because of the city’s laws. Instead, a new bidding process would have to be held and new licenses issued.
When asked if there should be a new-to-market concession offered during the upcoming process, which could allow additional licenses to be awarded, So stated, “Whether there is another operator coming in is a decision for the Macau SAR government or maybe the central government.”