Macau’s Court of Final Appeal has upheld a prison sentence for former Suncity Group CEO Alvin Chau of 18 years, rejecting his appeal to shorten the term. This comes at the end of a closely watched case that has had major implications for Macau’s casino industry.

Macau Court Denies Appeals by Chau and Eight Other Defendants

The court confirmed on July 3 in an in-camera hearing the initial ruling handed down in January last year, which found Chau guilty of criminal association, illegal gambling, and money laundering, reported the Macau Daily Times. Eight other defendants connected to the same case also had their appeals denied, keeping their sentences between nine and 12-and-a-half years.

Chau was convicted of making illegal gains through money laundering and illegal gambling activities. The court found that he and his associates brought in HKD24.87 billion ($3.18 billion) from these activities, which must be returned to the Macau government as ill-gotten gains.

His legal saga began when he was arrested by Macau authorities in November 2021 on charges including leading a criminal syndicate and being involved in illicit gambling operations. After several months of trial at the Court of First Instance, Chau was found guilty on 103 out of 229 charges related to gambling. Some were dropped because they exceeded the statute of limitations while another 59 were added on top of them. Chau was acquitted on charges linked to money laundering.

Court Decision Reinforces Government’s Commitment to Crackdown on Junket Industry

The final sentence remained unchanged despite multiple appeals, including one for clemency addressed to Chinese President Xi Jinping where he portrayed himself as a pivotal figure who transformed Macau into a global tourism hub. The Court of Second Instance scrapped his fraud conviction but jacked up the amount that should be paid back by Chau.

Attempts by the prosecution to reinstate fraud charges against him and seek tougher penalties failed too. 

However, this decision cements the hard Macau government stance taken towards Chau and others involved. It further underscores the clampdown against the junket industry and the crackdown on illegal gambling operations being carried out within Macao SAR borders.

Chau’s fall from grace reflects wider crackdowns on capital flight facilitated via junket operators as well as money laundering by Mainland Chinese authorities. Following his detention, Suncity Group – formerly Asia’s largest junket operator – was exposed to significant risks arising out of these activities leading to its shutdown.The case has also triggered sweeping changes across Macau’s casino sector with stricter regulations being put in place coupled with increased oversight mechanisms.

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Japan is largely viewed as an untapped potential by the gambling industry. Since the country greenlit three casino licenses, several companies have been eyeing opportunities for building a casino resort in the Land of the Rising Sun.

Kyushu Resorts Japan, a consortium led by Casinos Austria, sought to grab one of the licenses and presented a Nagasaki-based casino project. The local government approved the consortium’s presentation over competitors, such as Mohegan and Groupe Partouche.

However, the project was ultimately shot down by the Casino Administration Committee, as the central government had financial concerns about the proposal. According to the Ministry of Land, Infrastructure, Transport and Tourism, Casinos Austria’s project couldn’t present enough evidence to support the certainty of financing.

The principal reason for this was the precarious situation of Credit Suisse, the financial services firm that would have supported the project.

As a result, Kyushu Resorts Japan was unable to secure the coveted gaming concession, sending the Nagasaki province back to the drawing board.  

As it turns out, the Casinos Austria-led consortium is not going to appeal the decision.

Kyushu Resorts Japan and the Nagasaki Prefecture Accepted the Decision

As the March 27 deadline for appealing the government’s decision approaches, Kyushu Resorts Japan announced that it doesn’t plan to dispute the central government’s decision to block the project.

Takashi Oya, the consortium’s chief executive, told GGRAsia that no administrative appeal request will be filed by his team. He explained that the unclearness of the government’s criteria and a lack of understanding led to the project’s downfall.  

Kengo Oishi, Nagasaki’s governor, is also expected to agree with the decision. Many expect him to make a public statement very soon.

Had the project been approved, Kyushu Resorts Japan would have constructed a $3.3 billion casino resort, primarily financed by Credit Suisse. The casino complex would have included as many as 2,220 slots, 220 gaming tables and 8 hotels.

In the meantime, the Osaka Integrated Resort project began construction, marking the coming of casino gaming to Japan.

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Blackpool South MP Scott Benton has lost his appeal against a proposed suspension from the House of Commons following his involvement in a gambling-related lobbying sting operation. The Independent Expert Panel (IEP) dismissed his appeal as the UK prepares to enter the next stage of consultations on its upcoming gambling white paper.

The Parliament Condemned Benton’s Conduct

Mr. Benton was suspended from the Tory parliamentary party in April after an undercover investigation by The Times revealed that he was willing to break lobbying rules for money. In the gambling-related lobbying sting, Benton suggested to undercover reporters that he would agree to receive payment to assist a fake lobbying company by providing it with confidential documents.

The standards committee found that Benton’s actions constituted a substantial breach of regulations and recommended a 35-day suspension. Despite the MP denying his wrongdoing, the IEP ruled that they found his arguments insubstantial and upheld the suspension. Now, MPs will vote on the punishment, and if passed, triggering a recall petition and a possible by-election.

Taking all these matters into account, we are satisfied that there is no substance in the Appellant’s grounds.

IEP statement

Benton’s conduct caused significant controversy, receiving descriptions like “corrupt” and “for sale.” By undermining the Parliament’s reputation, Benton effectively violated Paragraph 17 of the House of Commons Code of Conduct, which states that members should undertake actions that could cause significant damage to the reputation and integrity of the House of Commons or its members.

UK’s Gambling Reform Faces Ongoing Challenges

In response to this newest ruling,  Benton expressed deep disappointment and accused the appeals process of regular leaks to the press. He emphasized his continued work for his constituents throughout the probe and claimed the process lacked fairness. While Benton admitted he had a lapse of judgment, the MP protested that his punishment was disproportionate.

This scandal further inflames the ongoing debates regarding the UK’s gambling white paper, which should reinvent the country’s gambling regulations. During the sting operation, Benton admitted that other MPs were willing to collaborate, highlighting how bad actors could attempt to subvert the much-needed reforms as the UK struggles with rising problem gambling rates.

Benton’s suspension highlights the growing tensions amidst the UK’s gambling reforms. Lawmakers have urged the government to hasten the consultation process and finalize the white paper, noting that further delays could have significant repercussions. This lobbying controversy is a potent reminder that some industry members may not share the same customer protection-focused priorities.

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Imperial Pacific International (IPI) faced another crippling blow on Monday as the US Supreme Court rejected its petition, upholding the Ninth Circuit’s previous ruling regarding the case. This decision allows the Commonwealth Casino Commission (CCC) to proceed with the revocation hearing concerning IPI’s casino license and will likely spell the end for Imperial Palace Casino in Saipan.

The Operator Exhausted All Legal Options

The casino, operated by IPI, ceased operations in March 2020 due to the COVID-19 pandemic, suffering a license suspension in April 2021 for failure to pay its license fees. IPI contested this decision, citing force majeure as the primary reason behind its casino closure. However, the Supreme Court highlighted that the force majeure event had concluded, and IPI had to pay its dues.

IPI, in response, filed civil suits against the CCC, alleging breaches in the casino license contract and an overstepping of its regulatory role in interpreting the agreement. The following legal disputes won the beleaguered operator some extra time to resolve its most pressing issues, but its efforts appear to have been in vain.

The CCC’s final compromise gave IPI until 30 December 2023 to pay back the $62 million in missed license fees or lose its license for good. That deadline passed without any attempts from the operator to pay its dues. Following the Supreme Court’s decision, the CCC is now free to hold a revocation hearing, which will likely spell the end of this saga.

A License Revocation Seems Inevitable

Commission representatives expressed relief at the Supreme Court’s decision, welcoming the opportunity to determine the fate of IPI’s license. Commissioner Ramon Dela Cruz stressed that IPI had ample time and due process to address its financial obligations to the CNMI government. The upcoming revocation hearing is scheduled for 31 January 2024 and should finally put the matter to rest.

Attorney General Edward E. Manibusan hailed the recent legal breakthrough, stressing the importance of enforcing IPI’s obligations to the CNMI. Although a license revocation is a natural next step for the Commission, the Commonwealth will likely face difficulties collecting its dues, as IPI has exhausted most of its assets, even auctioning off its liquor inventory.

This victory is important for the people of the Commonwealth in enforcing IPI’s failure to meet its contractual and statutory obligations to the people of the CNMI.

Attorney General Edward E. Manibusan

Despite legal challenges and appeals, the ruling from the highest court in the country affirms the CCC’s authority to pursue the revocation of IPI’s casino license. Although the process includes an official hearing, it is little more than a formality. This case highlights the lengths to which even a smaller casino operator will go to salvage its business, even against overwhelming odds.

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Spain has rejected Jdigital’s claims that its new gambling ads regulations are unconstitutional. The online gambling trade association’s complaint was launched following the passing of the Royal Decree that imposes strict restrictions on ads.

The Royal Decree was passed in November 2021, introducing major changes to how gambling advertisement is regulated. The new rules set a narrow window for the airing of gambling ads, allowing operators to advertise only between 1 am and 5 am.

The decree’s ultimate aim is to protect the Spanish public from being constantly bombarded with ads that encourage them to gamble.

This controversial ban was critiqued harshly by supporters of the gambling industry who claimed that it would cause more harm than good. Arguing that problem gambling is already on the decline, Jdigital insisted that the ban will only slow down the growth of Spain’s gambling industry.

In addition, Jdigital believed that Spain had bypassed important constitutional procedures when introducing the measure. The association was also uncertain whether the Ministry of Consumer Affairs could introduce such changes without certain amendments to the gambling law.

As a result, the trade union launched a formal appeal, hoping to overturn the decree. Unfortunately for the association, its appeal was rejected.

Jdigital Lost a Long and Hard Battle

After years of legal trouble, Jdigital’s appeal was reviewed by the Constitutional Court and promptly rejected. The court pointed out that the Ministry had, in fact, secured necessary amendments to the gambling law prior to adopting the new advertising changes.

The Constitutional Court unanimously rejected Jdigital’s appeal, dealing a major blow to the Spanish gambling industry and, according to Jdigital’s previous claims, making Spain less attractive to international companies.

In the meantime, Spain’s openly anti-gambling Minister of Consumer Affairs, Alberto Garzón, just exited politics. However, the industry should not celebrate yet as his successor’s stance on gambling is still unclear.

Garzón will be succeeded by Pablo Bustinduy who will step in as Minister of Social Rights, Consumption and Agenda 2030 – a new position that replaces the Minister of Consumer Affairs. Bustinduy has yet to talk about gambling in depth but has been accused of harboring extreme-left anti-capitalist sentiments.

While there is no clear indication that Bustinduy will be another adversary of Spain’s gambling industry, the industry fears that its hopes for a pro-gambling minister might have been dashed.

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Video game giant Electronic Arts (EA) has decided not to appeal a recent fine it received in Austria because of its loot box-styled products. The gaming company emphasized its disagreement with the decision but decided not to contest the authorities’ judgment.

The fine was handed to EA after an Austrian court decided that the company’s FIFA Ultimate Team Packs are in breach of Austria’s gambling regulations. Similar to other similar digital products, the packs can be bought with real money and contain virtual assets that are usually generated at random.

Loot boxes are one of the hot topics of the video gaming industry. Because of their inherent similarities to gambling, many argue that they can serve as “gateway products” that incentivize young people to wager. Others claim that that the boxes themselves constitute gambling.

In any case, EA disagrees with the notion that its products constitute gambling. The company stands firm by its belief that its products are legal and in line with Australia’s regulations.

What EA Has to Say on the Matter?

An EA spokesperson expressed how the company feels about the current case. They underscored that EA believes the court “got both the facts and law wrong” in the case.

The spokesperson confirmed that EA does not intend to file an appeal since the decision will not have a profound effect on its business. However, the company still believes that it is in the right.

While we’ve decided not to appeal this narrow decision, which has no broader legal impact beyond this individual claim, we are confident that our games do not constitute gambling and that we are in full compliance with local laws.

EA spokesperson

The spokesperson added that EA is confident in the legality of its products and pointed out that regulators in multiple jurisdictions all over the world have previously ruled in favor of EA in similar cases. They noted that this includes another case in Australia that was decided by the very same Austrian Regional Court.

We design our games to bring choice, fairness, value and fun – we are committed to ensuring our Austrian players continue to have access to the same game and features as the millions of other players who enjoy them.

EA spokesperson

The video gaming sector remains divided on the topic of loot boxes. Regulators in multiple markets are equally inconclusive about how such products should be regulated. Still, the UK government recently released new guidelines for such products.

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Operating within different gambling markets requires licenses, especially on the Old Continent. With one of the strictest gambling-related laws, Norway’s market is closely monitored by local authorities. Back in 2019, the country’s Lottery Authority, Lottstift, urged Trannel International Limited, a company owned by one of the biggest gambling operators in the world, Kindred Group, to discontinue its offering for customers in the country.

Trannel, the company behind the brands Unibet, Mariacasino, Storspiller and Bingo, disagreed with that decision and filed an appeal which was consequently rejected by the Ministry of Culture and Equality, as well as the Lottery Board in January 2020 and March 2020 respectively. Then, in February 2022, Lottstift issued a notice of a compulsory fine against Trannel while in June the same year, the Oslo District Court confirmed the legality of the Authority’s decision to implement a suspension against Trannel.

After that, the Lottery Authority imposed a compulsory fine of NOK 1.2 million ($108,600) per day against Trannel. At the time, the gambling watchdog said that the fine would be valid until the operator discontinues “the illegal gambling offer in Norway.” Not unexpectedly, Trannel filed a complaint against the fine which was rejected by the Ministry of Culture and Equality, as well as the Lottery Board. Now, the Borgarting Court of Appeal also rejected Trannel’s appeal, siding with the Lottery Authority in the country and effectively putting an end to years-long legal battles.

Lottstift Urges the Company to Exit Norway

The Borgarting Court of Appeal’s decision was announced only recently, and it confirms that Lottstift was right to ask the company to withdraw from the gambling market in Norway. Anette Trettebergstuen, the country’s Culture and Equality Minister, explained that the latest court decision acknowledges that “the Norwegian exclusive rights model is in accordance with European Economic Area (EEA) law.” She also spoke about the result of the lawsuit, explaining that it comes as no surprise.

“The result is not exactly surprising, as this lawsuit joins the series of several other lawsuits in the gambling field where the state has been fully supported each time.“

Anette Trettebergstuen, Culture and Equality Minister in Norway

The Lotteries and Foundations Authority’s director, Atle Hamar, also commented on the topic. He explained that the latest court decision confirms that the Authority was correct to impose a suspension against Trannel. Given the court’s decision, Lottstift anticipates seeing the company “withdraw completely from the Norwegian market,” said Hamar in conclusion.

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