As further confirmation of the gaming world’s eastward tilt, this week saw the three members of the Nevada Gaming Control Board (GCB) travel to Macau for a meeting with their regulatory counterparts, the Gaming Inspection and Coordination Bureau (DCIJ). The Las Vegas Review-Journal quoted GCB chairman A.G. Burnett describing the trip – the first time all three GCB members had traveled as a unit to Macau on business – as a “fact-finding” mission that will prove “beneficial to both agencies.”
The GCB members also traveled to Hong Kong to meet with law enforcement officials “to understand how the region regulates the gaming industry.” Over the past year, Nevada-licensed operators such as Las Vegas Sands and Wynn Resorts found themselves under investigation at home due to alleged misconduct in their overseas business dealings. In October, Burnettt told Reuters the GCB was “getting to understand the junkets and how the VIP rooms operate. We haven’t decided whether that’s offensive to the way we operate.”
But Professor I. Nelson Rose, author of Gaming Law In A Nutshell, said that with Macau producing the bulk of these Nevada-licensed companies’ revenues, the GCB was unlikely to do much to rock the boat, regardless of how much the junkets offended their delicate sensibilities. “To some extent the Nevada regulators are just crossing their fingers.” As New Jersey discovered when it tried to force MGM Resorts to choose between Macau and Atlantic City, ultimatums only work if you’re delivering them from an advantageous position. (Nevada has yet to report its full year 2012 numbers, but Macau’s $38b is expected to outstrip Las Vegas gaming revenues by a factor of six or better… Again.) As former GCB chairman Mike Rumbolz put it, “years ago, companies were very concerned to get the blessings of Nevada regulators. Today, I don’t think you’d see that kind of concern.”
In case you were wondering, Porsche sales in Macau and Hong Kong rose 8% in 2012. Doubling down on Macau’s golden future, Morgan Stanley’s Praveen K. Choudhary and Katherine Sun have joined the analyst herd in predicting double-digit growth for the world’s #1 gambling enclave. They say overall gaming revenue will rise 13% in 2013, with the VIP sector tipped to grow 10% and the ever important mass market segment will bump up 20%. Sands China is tipped to gain the most (18%) in the first quarter of 2013, followed by Melco Crown Entertainment (12%), SJM Holdings and MGM China (10% each), Galaxy Entertainment (5%) while Wynn Macau is predicted to have a flat Q1.
