Regulations on betting services are paving the way for investors to push horse and dog racing projects in Vietnam.
The Ministry of Finance (MoF) late last month introduced a draft decree regulating the investment and operation of betting services, which will be submitted to the government for approval next month. Under the draft, betting services relating to sports and horse and dog racing will be allowed in Vietnam.
The draft was introduced in the context that several foreign investors registered to build horse racing tracks in Vietnam, but are waiting for government guidelines.
Accordingly, total investment capital of a horse racing track must be at least VND1 trillion (about $50 million) and VND300 billion for a dog racing track. Investors must complete a project’s construction within four years of gaining an investment certificate.
Betting services can only be provided after the investor sets up all equipment for racing operations. Investors are allowed to develop betting shops for providing betting services at some provinces and cities specifically regulated by the MoF.
“This is really a positive sign that raises hope for us to build our projects in near future,” said a source from South Korea’s G.O.Max Company. G.O.Max several years ago proposed to build a $570 million horse racing course in northern Vinh Phuc province, about 50 kilometres northwest of Hanoi. However, the investor had to stall the project as the government has yet to issue betting service regulations.
The introduction of long-awaited draft would officially legalise sport-betting services and attract more investors to build horse and dog racing courses in the country, said Hoang The Vinh, representative of the local partner in the dissolved Vietnam Horse Racing and Sports Club Joint Venture. This venture was dissolved and saw its investment certificate to build a $57 million horse racing course in Hanoi scrapped in 2007.
Vinh said the lack of governmental betting service regulations was a major hindrance for investors to develop horse and dog racing tracks in Vietnam. “The foreign investors behind the scrapped project pulled the plug because Vietnamese were not familiar with horse racing betting services. They dared not to push the investment without a specific regulation because they were afraid of government policy changes,” he said.
Vietnam has only one horse racing track in Ho Chi Minh City, named Phu Tho racing track and a dog racing track in southern Ba Ria-Vung Tau province. The tracks were invested by Thien Ma Company and Sport Entertainment Services Company respectively.
However, both have not been licenced to provide betting services. “We just provide rewarded sport entertainment services at the courses,” said Nguyen Ngoc My, director at Sport Entertainment Service Company.
He said the company would develop a dog racing course in Hanoi after the draft decree was approved, as the betting demand in Vietnam was rising. My, who is also director at Thien Ma Company, said about 5,000 and 3,000 people came to horse and dog racing tracks in Ho Chi Minh City and Ba Ria-Vung Tau each night, respectively. Total revenue at Phu Tho racing track was $11 million last year, he said.
Australian Binh Phuoc Entertainment Complex Company Ltd early this year gained a licence for developing a $100 million horse-racing course on 200 hectares in southern Binh Phuoc province, while waiting for betting to be legalised.
Besides regulating betting services for horse and dog racing, the draft decree also gives football-related betting regulations that will be piloted at centrally managed cities. However, MoF Vu Van Ninh last week told media on the sidelines of the on-going National Assembly meeting that the MoF had proposed state-owned companies would be the first ones providing football-related betting service for piloting.