Lack of legislation
Players in Macau are free to access overseas gaming websites on a passive basis; however, betting companies are subject to no regulation and therefore cannot operate within the Macau jurisdiction.
Considering that the emergence and expansion of gaming websites dates back to the 1990s, it would have come as no surprise if Macau – the world's largest gambling market – had created the conditions for non-landed gaming centres to flourish. Instead, and according to Law 16/2001 (the Gaming Law), the general framework for the operation of casino games of fortune and interactive games of fortune and chance cannot be exploited by gaming concessionaires.
Article 4 of the Gaming Law states that interactive gaming concessions are separate from concessions for the operation of games of fortune and chance in Macau casinos. Until now, the government has never legislated or issued an online interactive gaming licence to companies. Hence, all forms of online gambling in Macau are considered outlawed.
However, as well as the six existing concessions and sub-concessions for the operation of games of fortune and chance in casinos, four additional concessions were granted for the exploitation of:
- instant and Chinese lotteries;
- sports betting (eg, football and basketball wagers); and
- pari-mutuels (eg, horse racing and greyhound racing).
Instant lotteries, sports betting and pari-mutuels are not considered to be games of fortune and chance. In accordance with the law, it is illegal to offer pari-mutuels or operations intended for the public (eg, sports betting and lotteries) in a casino environment, even though the same legislation also provides that lotteries can be exploited by casinos, assuming that an amendment to the concession contract is made.
The concessions (and sub-concessions) of games of fortune and chance cover:
- all games mentioned in Article 3 of the Gaming Law (eg, table games);
- other games of chance authorised and regulated by the government after 2001; and
- authorised electric or mechanical machine games (eg, slot machines).
The forms of gaming not covered by casino concessions and sub-concessions are:
- operations offered to the public; and
- interactive casino games (understood as online games).
In further accordance with the legislation, table games and game machines (slots) can be offered only inside bricks-and-mortar casinos and other authorised venues. Whereas horse racing, greyhound racing and sports betting concessionaires are authorised to accept online bets through their websites, notwithstanding the lack of a specific legal framework for the regulation of online or mobile games.
It is clear that no licences are available to enable operators to offer remote gambling services in Macau, even though authorisations have been granted for the Macau Jockey Club (horse racing), Macau Yat Yuen (greyhound racing) and Macau SLOT (sports betting) to accept online bets – which are presently the only legal options for online gaming in Macau.
It is generally known that legislation was prepared to regulate online gaming a few years ago, but it was never submitted to the Legislative Assembly due to the opposition of the Chinese central government . Therefore, even taking into account the enormous potential of the online gaming industry, it is likely that remote gambling will not be regulated anytime soon.
Nevertheless – and considering the lack of legislation on remote gambling as well as on access, registration and effective bets on overseas online gaming websites – the fact remains that players located in Macau are free to access overseas gaming websites on a passive basis. Despite this, there have been a few cases of overseas online gaming companies preventing local customers from accessing their websites without any legal grounds.
Given the lack of a legal framework, there are no specific penalties concerning remote gambling. However, there is a risk that the government will consider remote gambling as an illegal activity in light of new laws. Nonetheless, it is unlikely that such a position would comply with the law or legal system as a whole. In case such a position is taken, due to the criminal nature of the regime, any infringement of the provisions regarding the offering of unlawful games of chance and fortune in unauthorised venues will be punished by up to three years imprisonment or a fine. The same criminal penalties will be applied to the provider of any illicit lottery or pari-mutuel.
At a time when Macau's gross gambling revenue is on the up following 26 consecutive months of decline, it is arguable whether opening the local market to remote gaming activities could breathe new life into this once-booming market, as the liberalisation of the gaming industry did in 2002.
For further information on this topic please contact Pedro Cortés or Manuel Moita Júnior at Rato, Ling, Lei & Cortés Advogados by telephone (+853 2856 2322) or email ([email protected] or [email protected]). The Rato, Ling, Lei & Cortés Advogados website can be accessed at www.lektou.com.