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Monday, 8 February 2010
Govt to keep an eye on casino credit
Easy credit will be available for premium players at Singapore’s casinos but the Casino Control Credit Regulations will also make it easy for the authorities to keep checks on both the casinos and junket promoters.
(SINGAPORE) Easy credit will be available for premium players at Singapore’s casinos but the Casino Control Credit Regulations will also make it easy for the authorities to keep checks on both the casinos and junket promoters.
In the credit regulations that were made public yesterday, it was revealed that casino operators and licensed junket promoters who want to extend credit to premium players will have to enter into a written agreement with their clients that stipulates conditions such as credit limit and interest rates on credit.
Premium players are those gamblers who have established and maintain a deposit account with either the casino operators or licensed junket promoters of not less than $100,000 before and at the end of play.
Records will have to be kept of dealings with clients, including the amount of chips issued on credit to a client or the amount of credit given for a client’s deposit account.
The repayment of chips on credit or credit given for the client’s deposit account will also have to be recorded.
This information is to be made available to the authorities.
The onus of the formulation of credit policy, procedures and controls will lie with the casinos and junket promoters. However, this will be subject to checks by the authorities.
These credit policies, procedures and controls will include the credit assessment criteria for clients as well as debt recovery procedures.
Interestingly, the credit regulations also state that casino operators and licensed junket promoters will not only have their credit policies, procedures and controls subject to inspections by the authorities here but will also be expected to implement these in all their branch offices, whether in Singapore or elsewhere.
Both casino operators at Resorts World Sentosa (RWS) and Marina Bay Sands operate in other gaming jurisdictions, as do most junket promoters.
Asked to comment, RWS spokeswoman Krist Boo said: ‘Resorts World Sentosa will work closely with the authorities to meet all gaming procedures and controls as required by law.’
Premium players are thought to be the key to the success of the casinos here with analysts expecting them to generate between 40 per cent and 60 per cent of the gaming revenue.
Still, Jonathan Galaviz, an independent travel and leisure sector strategist, reckons too much emphasis may be being put on premium players.
Currently, there is a different tax regime on profits for premium players and non-premium players - which is 5 per cent and 15 per cent respectively.
‘In my opinion, it would be more effective to have a flat 5 per cent casino revenue tax rate for both premium and non-premium player revenue,’ says Mr. Galaviz. This would allow both operators to bring as many customers as they can from around the world, he explains.
‘The two-tier tax structure of 5 per for premium play and 15 per cent for mass-market play is a good strategy, but a lower tax rate overall for mass market would be even more effective in ultimately bringing more tourists to Singapore,’ he added.
Research analyst Melvyn Boey of Bank of America-Merrill Lynch says that while the regulations do appear ‘very stringent’, Singapore has to look at it from ‘a holistic standpoint - considering social, political and economic impact’.
Construction on the casino at RWS, which will likely be the first of Singapore’s two casinos to open, is already completed. It is widely expected to open sometime this month.
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Govt to keep an eye on casino credit
By ARTHUR SIM
04 February 2010
(SINGAPORE) Easy credit will be available for premium players at Singapore’s casinos but the Casino Control Credit Regulations will also make it easy for the authorities to keep checks on both the casinos and junket promoters.
In the credit regulations that were made public yesterday, it was revealed that casino operators and licensed junket promoters who want to extend credit to premium players will have to enter into a written agreement with their clients that stipulates conditions such as credit limit and interest rates on credit.
Premium players are those gamblers who have established and maintain a deposit account with either the casino operators or licensed junket promoters of not less than $100,000 before and at the end of play.
Records will have to be kept of dealings with clients, including the amount of chips issued on credit to a client or the amount of credit given for a client’s deposit account.
The repayment of chips on credit or credit given for the client’s deposit account will also have to be recorded.
This information is to be made available to the authorities.
The onus of the formulation of credit policy, procedures and controls will lie with the casinos and junket promoters. However, this will be subject to checks by the authorities.
These credit policies, procedures and controls will include the credit assessment criteria for clients as well as debt recovery procedures.
Interestingly, the credit regulations also state that casino operators and licensed junket promoters will not only have their credit policies, procedures and controls subject to inspections by the authorities here but will also be expected to implement these in all their branch offices, whether in Singapore or elsewhere.
Both casino operators at Resorts World Sentosa (RWS) and Marina Bay Sands operate in other gaming jurisdictions, as do most junket promoters.
Asked to comment, RWS spokeswoman Krist Boo said: ‘Resorts World Sentosa will work closely with the authorities to meet all gaming procedures and controls as required by law.’
Premium players are thought to be the key to the success of the casinos here with analysts expecting them to generate between 40 per cent and 60 per cent of the gaming revenue.
Still, Jonathan Galaviz, an independent travel and leisure sector strategist, reckons too much emphasis may be being put on premium players.
Currently, there is a different tax regime on profits for premium players and non-premium players - which is 5 per cent and 15 per cent respectively.
‘In my opinion, it would be more effective to have a flat 5 per cent casino revenue tax rate for both premium and non-premium player revenue,’ says Mr. Galaviz. This would allow both operators to bring as many customers as they can from around the world, he explains.
‘The two-tier tax structure of 5 per for premium play and 15 per cent for mass-market play is a good strategy, but a lower tax rate overall for mass market would be even more effective in ultimately bringing more tourists to Singapore,’ he added.
Research analyst Melvyn Boey of Bank of America-Merrill Lynch says that while the regulations do appear ‘very stringent’, Singapore has to look at it from ‘a holistic standpoint - considering social, political and economic impact’.
Construction on the casino at RWS, which will likely be the first of Singapore’s two casinos to open, is already completed. It is widely expected to open sometime this month.
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