The gaming labours of Adriano Ho

With today (Wednesday) marking the first official day in office for the new Gaming Inspection and Co-ordination Bureau (DICJ) Director, Adriano Marques Ho, MNA together with legal law experts compiled what will be the main challenges ahead for the new gaming watchdog head.

After five years as head of the DICJ, Paulo Martins Chan stepped down from the position, with Adriano Ho, a former advisor to Secretary for Security Wong Sio Chak, sworn in the position today.

These are the four main issues one can expect to be first in Ho’s to-do-list:

1-Dealing with a gaming sector hailing from the impact of the Covid-19 pandemic

Adriano Ho will take the DICJ helm in a difficult period for the local gaming sector, with the industry reporting historic low gaming results since the liberalisation of the sector in the early 2000s.

Gross gaming revenues plunged by 73.7 per cent between January and May to some MOP33 billion (US$4.1 billion), with April reporting a record low of some MOP754 million, a 97 per cent year-on-year drop.

“I would say that big challenge for Mr.Ho […] is that there is now a regulator facing the most negative gross gaming revenue results since the handover and gaming liberation. We will have much less gaming taxes to collect. At the same time, he will have to consider also the lack of resources from the operators’ side,” said lawyer Óscar Alberto Madureira, a former Senior Legal Counsel at casino operator Melco Entertainment

Another gaming law expert, lawyer Carlos Lobo, also agreed that Ho’s largest and most immediate challenge will likely be to reset the gaming industry post-Covid-19 after border flows in the region return back to normal, especially the Mainland China border.

“He will have to assure that the health requirements set for the gaming industry continue to be respected by gaming operators,” underlined Lobo, a former legal advisor to the Macau Gaming Commission.

Since casinos were allowed to re-open operations in February the DICJ implemented several health guidelines for players, including body temperature checks on all visitors and workers, cleaning and disinfection of gaming areas, requesting visitors to complete health surveys before entry and player and distance limits per gaming tables.

“The operations itself will have to be adapted in a matter that will have to meet the health standards now implemented in other jurisdictions, such as Las Vegas. So there will be health regulations to be implemented but maybe with care so as to not harm the activity in a way that is not attractive to players […] It’s a hard task since we all know how passionate players are, but the safety of dealers will have to be considered,” Madureira added.

The legal expert remembered the discussion over enforcing a smoking ban and adding smoking lounges in gaming areas, with local gaming workers using their bargaining power to pressure for the new legislation enforced since 2018 in casinos.

However, he noted the circumstances would be different this time around.

“Gaming operators might not have the financial power in the negotiations but maybe dealers will also not have the same negotiating power to bargain for better conditions since at the end of the day their jobs might be at risk,” the lawyer told MNA.

2-Controlling the local junket sector

Madureira underlined that the past DICJ administration showed a strong commitment to changing the operating environment for junket operations, including changes to anti-money laundering guidelines.

“But we need more changes. We need to increase the amounts of the collaterals to be deposited, we need to increase background checks to junket operators and increase certainty to sub-junkets and the way they have been acting for a few years now,” Madureira stated.

Lawyer Carlos Lobo also underscored that there will need to be a more “serious look” into who are the employees in local junket operators so as to weed out “elements that should not be in the gaming sector”.

Lobo added that he anticipated great competition between junket operators to bring their VIP players to the city as border limits ease, with the DICJ having to deal with delicately with the increased competition.

“Considering Mr. Ho’s background in security and the gambling criminal investigation unit of the Judiciary Police I don’t think he will have any problems dealing with this […] Junkets will need cash flow and to bring their players in which could create a delicate situation of fierce competition,” Lobo noted.

Ho has been one of the top advisors to Secretary for Security Wong Sio Chak since 2014 and was previously head of the Judiciary Police’s (PJ) gaming-related and economic crimes investigation unit from 2012 to 2014, when Wong was PJ director.

3 – Revamping the local gaming law in areas such as satellite casinos and slot machine parlours

“The local gaming legal framework needs an urgent update. From the number of concessions to the legislation applying to junket operators and legislation on satellite casino operations. All this needs to be more clear, specific and of course, meet the international standards,” Madureira noted.

Most satellites casinos in the city are essentially sublicensees of Macau’s six concessionaires and subconcessionaires, although a majority operate under the SJM license.

“Satellite casinos are everywhere in the city so no one really knows how can we integrate these operations within the legal framework and how it can be defended or made legit. It’s also a big challenge to arrange legal certification to keep or finish these operations,” Madureira added.

The gaming law expert also considered the issue of slot machine halls outside casinos a matter that needed to be addressed by the new DICJ Director.

“This has been discussed for quite a few years. The law changed in 2011 to maximise and impose new requirements for these operations. A few outlets were closed since then but there are still outlets in the city close to residential buildings. I would say this is also an issue to solve,” the lawyer stated to MNA.

4-Preparing the 2022 gaming concession tender

The new DICJ Director will also obviously have to deal with the future gaming tender in 2022, with Carlos Lobo noting Ho will have a crucial role in coordinating and collecting information on the gaming operators that will be essential for the administration to select the gaming concessionaires.

“At the same time, he will have to work in any eventual future changes decided by the government on the matter and will have to implement them and make sure they go smoothly,” added Lobo , who was a legal advisor to the 2002 Tender Commission that granted Macau’s first post-monopoly casino concessions.

The security background of the new DICJ head could also point to a larger focus in enforcing the legal duties held by local gaming concessionaires.

“He will have the strong challenge of leading the international tender for the selection of the new operators if the arrangements to be made to the old legal framework have not already been done by the previous administration. If not he will have the role to pout them in place and continue with the amendments within the existing legal framework,” Madureira added.