Japan Pushes Back Casino Application Period Nine Months

  • The window for IR proposals has been moved to October 2021 through April 2022
  • The COVID-19 pandemic has created uncertainty for local governments and operators
  • Some operators have already withdrawn from contention
  • A bribery scandal involving a government official has darkened the application process
Japan's Himeji Castle with Mt. Fuji in the background
Because of the effect of the COVID-19 pandemic on local governments and casino operators, the application window for Japan’s integrated resort licenses has been pushed back nine months. [Image: Shutterstock.com]

Pandemic created too much uncertainty

The launch of the brick-and-mortar casinos in Japan is still several years out, but now it appears it will be delayed even further. After conversations this week, the central government has pushed back the application period for local governments to make their pitch for an integrated resort (IR).

The application window was originally January 4 through July 30, 2021. On Friday, the Japan Tourism Agency published revised basic draft guidelines, moving back that window a full nine months because of industry and government disruptions caused by the COVID-19 pandemic. The new application period is October 1, 2021 to April 28, 2022.

there have been opinions expressed that the future is uncertain”

“Some IR operators who have partnered with local governments are in a difficult situation due to the impact of COVID-19, and there have been opinions expressed that the future is uncertain,” Japan’s Minister of Land, Infrastructure, Transport and Tourism, Kazuyoshi Akaba, said in August.

Japan is making three casino licenses available. The hope was that the first IR (casino) would open in 2025, but delaying the city applications by nine months has put those hopes to bed. It seems that one will be unable to belly up to a Japanese blackjack table until 2026 at the earliest.

Some operators giving up

The other side of licensing is operator selection. The guidelines have not been finalized, but do include five evaluation criteria for determining how the three operators will be chosen: the actual design concept for the IR, the positive impact it will have on tourism and the economy, the capabilities and financial stability of the operator, how much revenue will flow back to the cities, and the operator’s plan to combat crime and problem gambling.

There are currently four cities vying for licenses: Nagasaki, Osaka, Wakayama, and Yokohama. All have experienced delays in their proposals because of the pandemic.

right now it’s not a focus for our company.”

Casino operators have also been adjusting their plans. Wynn Resorts closed its office in Yokohama, indicating it is likely out of the running in the city. CEO Matt Maddox did say the company is still interested, but “right now it’s not a focus for our company.”

Las Vegas Sands, which makes most of its money in Asia and Macau specifically, withdrew from the Yokohama competition in May.

MGM Resorts is still pursuing an IR in Osaka, but has said it could reverse course if it doesn’t think it will be profitable.

Bribery scandal has blighted the process

This is just the latest setback in Japan’s IR process, as it has been marred by a political bribery scandal. In August, two advisors to Chinese internet gaming company 500.com admitted in court to bribing the former head of Japan’s Ministry of Land, Infrastructure, Transport, and Tourism, Tsukasa Akimoto, for favorable treatment in the race for a casino license.

Masahiko Konno and Katsunori Nakazato are accused of paying Akimoto ¥3m ($28,405) in late 2017 and early 2018 and an additional ¥7.5m ($71,013) to cover travel expenses for Akimoto to visit 500.com’s headquarters in Shenzhen.

A third accomplice, Kimihito Kamori, who was chairman of the travel agency Kamori Kanko Co., paid Akimoto ¥760,000 ($7,196) for a family trip. He was sentenced to ten months in prison in September.

For his part, Akimoto is also suspected of trying to pay both Konno and Nakazato to give false testimony. Law enforcement officials have recovered cash given to Konno with Akimoto’s fingerprints on it, as well as e-mail communications with a co-conspirator.

Akimoto has been arrested multiple times.

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