Draft regulation continues tight control over casinos

Illustrative photo. Investors must have USD2 billion on hand to start their gambling business in Vietnam

>> Fledgling gambling industry needs to raise the stakes

The National Assembly’s Standing Committee will discuss a new version of the draft decree on the casino business today, April 17. Some of the restrictions in the new version are looser than those in the one proposed in 2012. For example, the limit of 3% gaming area compared to the rest of the entertainment space, a maximum of 2,000 gambling machines and the 180 cap for the number of game tables have been removed.

However, the draft regulation still requires investors to have at least ten years experience in casino management. Investors must also have pledged capital of at least USD4 billion, half of which is immediately disbursable. This means that investors must have USD2 billion on hand to start their business. This requirement is stricter than in the previous version.

One casino project, “Tuan Chau Island’s King," established by Dao Hong Tuyen, Chairman of Tuan Chau Group and ISC Group of Australia, may be unviable, as the investors do not have 10 years experience in the business despite their USD7 billion investment.

Even though around six small-sized casinos have been opened in some provinces including Bac Ninh, Hai Phong, Lang Son, Quang Ninh, and around 40 gambling spaces at several major hotels across the country, no Vietnamese investors are able to meet the experience requirement.

An anonymous expert said that another casino project in Ho Tram tourism area in the southern province of Ba Ria – Vung Tau may be also unfeasible for failing to meet the required disbursable capital requirement of USD2 billion.

One of the most prominent issues has been the regulation banning Vietnamese citizens from playing at casinos. This was the most debated topic at the NA sessions late last year, and the outcome disappointed many investors.

Nguyen Vu Thanh, Acting Chief of the US-ASEAN Business Council, said, “It’s irrational to ban local residents from playing at casinos. They have the most potential as customers."

Professor Augustine Ha Ton Vinh said that the government should have a consistent approach to the industry.

He went on to say that, while the NA’s Finance and Budget Committee considers this a sensitive business that is should not be incentivised, several provincial leaders are rolling out the red carpet for casino giants.

He noted that the Japanese government is considering developing the casino industry there. However, they do not encourage foreign investment.

He added that Vietnam should draw a lesson from Japan in order to save time and foster the right kind of investment in the sector.