4 Things to Know About the New Casino Laws in Japan

On July 20th 2018, the Japanese Parliament passed a bill legalizing gambling resorts. The bill had been held up for almost two decades due to apprehensions over gambling addiction. The fact is that the new laws unlock an extremely lucrative market.

The facilities will be called “integrated resorts”, probably as an attempt to mask the gambling aspect of the complexes. They will consist of not only casinos but also conference and entertainment rooms, as well as hotels.

The Prime Minister feels these new regulations and constructions will boost tourism, attract investment and strengthen the economy. But as with any law, it isn’t as simple as black and white. So, here are the answers to the four most important things to know about Japan’s new casino laws.

What does the law enable?

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It allows casino gambling at the integrated resorts. The complexes must pay a 30% tax to the government and can only have gaming areas in 3% of the total space. Foreign visitors can get in for free, but locals have to pay approximately $50 and are only allowed to visit a maximum of 10 times per month.

Japanese lawmakers were attracted by the fact that resorts in Singapore that combine tourism and gambling activities thrive and contribute greatly to the economy, the employment and tourism. But over 70% of the revenue from those resorts comes from gambling. However, the first Japanese integrated resort is only set to open in 2025, missing the array of opportunities the 2020 Tokyo Summer Olympics will bring.

Who will run the resorts?

Huge international casino operators have shown interest in running activities in Japan. 3 of them are Las Vegas-based. Macau’s Galaxy Entertainment Group and Melco Resorts & Entertainment are also in talks, as well as Malaysia’s Genting Group.

However, Japanese companies are equally eager to participate, including Paradise City Incheon, Sega Sammy Holdings, H.I.S. and Konami Holdings.

Is Japan valuable to the casino industry?

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In the first half of 2018, Japan welcomed 16 million international visitors, an increase of 16% when comparing to the same period in 2017.

Goldman Sachs estimates that once Japan opens three of the new resorts the casino market will rocket to $16 billion. If proven true, this would turn Japan into the second biggest worldwide gambling market, only behind Macau.

Who will visit the integrated resorts?

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Goldman Sachs foresees that locals and foreigners will visit the casinos in a ratio of 57% and 43%, respectively. And we can’t forget that Japan has been registering rising numbers of inbound visitors.

The reason Japan’s own citizens could be a huge source of income to the casinos is that a great number of bettors have until now been limited to gambling on horse and motor racing. Additionally, the new law enables both tourists and nationals to borrow money from the casino operator. That is something that leads to concerns over addiction and debt, but will also potentially attract many more gamblers.

The Japanese gambling landscape is changing but the procedures to open the resorts will undoubtedly face strict legislation and blocks from the opposition along the way.

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