The Central Bank of Uruguay (BCU) has recently expanded its regulatory framework to encompass all online gaming and betting platforms to curb unauthorized transactions. This new regulation specifically targets Payment and Collection Service Providers. This category includes popular providers such as Abitab and RedPagos, as well as the entire network of international transactions related to gaming and betting sites.

In its official statement, the BCU emphasized the importance of implementing adequate prevention mechanisms among these providers. “Payment and Collection Service Providers must have adequate prevention mechanisms in place to prevent money transactions associated with gambling and illegal betting of any kind from being channeled through them,” the statement read, referencing Article 171.1 (Prohibitions) from the fourth part of Book IX of the Compilation of Payment System Standards.

Protection and Compliance

The BCU’s regulation, which already applies to Electronic Money Issuing Institutions (IEDE), aims to protect users by ensuring a solid, efficient, innovative, and accessible payment system. Including Payment and Collection Service Providers in this framework obliges these entities to adopt measures that prevent non-compliance through their services.

Furthermore, the BCU highlighted the legal framework surrounding online gambling and betting, which deems the provision of such services through the Internet or technological platforms illegal unless authorized by the competent authority. This move is essential for Uruguay to prohibit such transactions and maintain regulatory compliance.

Modernizing Payment Systems

In related news, Mastercard announced the implementation of its global biometric payment program in Uruguay. This initiative involves testing a palm-based payment system in collaboration with partners such as Ingenico, Fujitsu Frontech, Fulcrum Biometrics, and Scanntech at Tienda Inglesa’s Red Expres. Shoppers can register their information, payment credentials, and biometric data on-site, allowing them to pay for goods by placing their hand over a sensor at the payment terminal.

Comprehensive Measures and Future Implications

The BCU’s decision, documented in Resolution D-197-2024, follows a thorough review of gambling and illegal betting transactions. The regulation mandates that Payment and Collection Service Providers must implement measures to prevent these transactions, extending the already established Electronic Money Issuing Institutions framework to a broader range of financial service providers.

This comprehensive approach is supported by various legislative acts, including Law No. 1,595 of December 12, 1882, and Law No. 19,210 of April 29, 2014, along with their respective amendments. The BCU aims to promote a secure and efficient payment system that adapts to market developments while ensuring compliance with legal standards.

By adopting these measures, Uruguay strengthens its regulatory environment, aiming to create a more secure and transparent financial system. This extension of the regulatory framework underscores the country’s commitment to protecting users and maintaining the integrity of its financial system amidst evolving technological and market landscapes.

Source: Banco Central del Uruguay DIRECTORIO – RESOLUCIÓN R.N°:D-197-2024 [pdf], Montevideo, 3 de julio de 2024.

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However, Japan’s Ministry of Land, Infrastructure, Transport, and Tourism is having none of it, as the government has qualms about the feasibility of the project as submitted by Nagasaki.

Nagasaki Misses the Mark with Government

Kyushu Resorts Japan and Nagasaki prefecture will have to go back to the drawing board or fold their bid altogether. Government officials have expressed open worry over the nature of financing of the proposed projects.

There seems to be an unsatisfactory level of commitment outlined in the letters that are supposed to show support and outline the terms of funding. They are customary and usually enough to convince government officials to indeed agree and proceed with the further stages of a project.

As such, the panel that weighed in on the decision said that they still doubted whether the proceedings could move on due to this lingering fear of lack of funds. It’s not just the funding, though, as the panel is similarly dubious of the chosen companies that will supposedly operate the project.

Casinos Austria International was the only participant who had a hands-on approach in such matters, and it was unlikely that CAI alone would make up for all the participants in the Kyushu Resorts Japan consortium. More worryingly, CAI’s investment is smaller than that of keener but less experienced parties.

Lack of Expeirence and Other Concerns

There was also outlined fear about how the proceeds from an operational casino resort would be divvied up, as too many investors – as is the case with Nagasaki’s bid – would mean that there will be many parties that are eager to recoup their investment overlook other important aspects, such as eliminating the harmful influence of casinos.

Nagasaki still has plenty of time to consider a revised bid, although securing more investors – or the right investors as it were – and eliciting stronger commitment would prove the most difficult part.

Still, overblow fears of recession and a flagging economy may embolden overseas companies with plenty of experience and cash on hand to move more strongly on Japan, and use the near-miss Nagasaki just had with the government to rally and potentially host one of the casino resorts – a total of three to arrive in the year over the next decades or so.

Osaka in the meantime has been gaining steadily with its construction and is likely to arrive on time.

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Light & Wonder will continue to focus on Asian markets in pursuit of its strategic objective of becoming the number one gaming equipment supplier globally, according to the company’s senior vice president and international managing director for EMEA & APAC, Simon Johnson.

Johnson pointed out that the strategic goal to become the world’s number one supplier of gaming equipment and technology was at the center of the company’s Board policy. Johnson spoke to Inside Asian Gaming at this week’s Global Gaming Expo Asia (G2E Asia) Special Edition: Singapore.

Former Aristocrat Execs Key to Asian Growth

Referring to Light & Wonder chairman Jamie Odell and executive vice chair Toni Korsanos, Johnson outlined that the pair had a clear vision of that goal from the beginning, “a track record of having done it once before and a very clear determination to do it again,” and make Light & Wonder “the biggest and the best.”

Former Aristocrat chief executive officer Odell joined Scientific Games as a special advisor to the chairman and the CEO in 2019, while former senior advisor to the Board and CEO of Aristocrat Korsanos joined a year later to serve as SG’s executive vice chair. Scientific Games rebranded to Light & Wonder in March 2022.

Johnson also said that management identified Asia as the market where Light & Wonder is “closest to that number one spot,” even considering that in some aspects performance-wise, the business was “already there,” yet determined to show that it was not just about words but “a true statement of intent.”

Speaking of vice president and managing director, EMEA &APAC, Ken Jolly, and his team, Johnson hailed the “fantastic job” they have done in “driving that growth and really pushing hard to get the maximum results,” while the focus of the business shifted entirely to being “a content platform” after the divestment of its lottery and sports betting businesses.

Targeting Near- and Long-Term Growth

Targeting significant growth in the next two to three years while also ensuring growth sustainability in the long-term, Light & Wonder has “the time and the focus to really invest” in its business in Asia, Johnson outlined, looking forward to upcoming “really exciting developments” about the company’s Asian roadmap.

“We’re very focused on driving this momentum of sequential growth and improving the stability of that performance,” he said, adamant that “building sustainable performance improvement over the long-term is at the heart of what this is.”

Johnson concluded by noting that the evolution of the business and competition may change the “prism of exactly what [being] number one means” but that one should “never lose sight” of its meaning in terms of “improvement in shareholder value and improvement in performance,” so that the cycle of performance driving confidence and confidence driving performance is closed.

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The Prime Minister of Japan announced Friday that a key committee had approved the development of an integrated resort casino (IR) in the Prefecture of Osaka.

Prime Minister Fumio Kishida heralded the decision by the Minister of Land, Infrastructure, Transport and Tourism’s review committee to greenlight after a meeting of the Headquarters for the Promotion of Integrated Resort.

MGM Resorts will participate in the operation and own a significant portion of the project along with Orix Corporation, a Japanese financial firm that is listed on the Tokyo and New York stock exchanges. The two firms will reportedly control equal 40% shares.

The resort will be operated by a newco. The consortium will include about 20 local companies.

Long Road to Arrive at Osaka Casino Resort

The central government’s approval comes after years of struggles and delays as there were initial hopes that the supporting legislation and approval could happen in enough time before the 2020 Tokyo Summer Games to capture revenue from the surge in tourism.

However, it wasn’t until 2018 when the Japanese Diet (parliament) finally authorized the construction of integrated resorts (after supporting legislation was passed in 2016) as part of a tourist resort. Several more years passed as the complicated framework was hammered out and the proper political coalitions could be found. The law, originally championed by former Prime Minister Abe finally came into effect in 2021.

The massive casino resort complex on the man-made island of Yumeshima in Osaka Bay will not be opened before the ward of Osak holds the World Expo in 2025. While the target date and final build cost estimates are certain to change over time, it is now expected to cost some US$10 billion to build with an opening anticipated in 2029 or 2030. Current cost estimates range between $8.5m and $13.5 billion (¥1.8 trillion).

Most multi-billion dollar casino developments around the world are allowed to open a temporary casino prior to full completion of the surrounding resort amenities, but Japan is a law unto itself when it comes to such matters. It’s currently unclear how the hotels and conference centers, shopping malls, museums, and ferry terminal will be phased in or if the casino will be allowed to open after certain benchmarks are achieved.

While several regions across the country were initially open for proposals, in recent years it has boiled down to Osaka and possibly Nagasaki. The 2018 legislation authorized the building of up to three IRs.

Already More than 7,000 Gambling Parlors in Japan

While this will be Japan’s first legal casino, gambling on Pachislo slots or pachinko machines that resemble vertical pinball games has always enjoyed a carve-out as a cultural exception. Players left as much as ¥14.6 trillion yen in those machines as of 2021.

More than 7,000 parlors featuring those games are scattered across the county, particularly in high foot-traffic areas such as near train stations. Other forms of gambling that were allowed before the casino bills passed include horse racing, motorboat, and motorcycle racing, bicycle race betting, and a restricted form of soccer betting as well as a lottery.

The MGM/Orix resort is expected to bring around 20 million visitors a year to the area who are expected to spend as much as $8.5b (¥1.14 trillion) each year once the full resort is open. Peak employment for the entire facility is expected to reach as high as 15,000.

Japanese citizens will have to pay a fee for every 24 hours they spend in a casino and there is a cap on the number of times one can visit. Family members will be able to request that any member be excluded from entering the premises.

Nagasaki is Still “in the running”

Asian media reports indicate that while Nagasaki is still “in the running” for a second IR for Japan, that issue didn’t come up at Friday’s meeting. However, GGRAsia reports that it has confirmed with local officials that the authorities in Nagasaki are still in discussions with central government officials about its plan for a casino resort.

The Nagasaki casino resort would be located in Sasebo City next to Huis Ten Bosch theme park, according to currently known plans.

In announcing the IR’s approval, Prime Minister Kishida said: “The Minister of Land, Infrastructure, Transport and Tourism has decided to certify Osaka’s area development plan. Osaka’s IR will contribute to the development of the Kansai region after the 2025 Osaka-Kansai Expo and to the growth of Japan. It is expected that it will become a tourist base that spreads the charm of Japan to the world.”

Earlier, Brian Sandoval President of Global Gaming Development at MGM Resorts said: “We want to provide guests with a new IR destination experience that is uniquely Japanese. Japan is advanced in technology innovation. It is also known as the best in class in terms of hospitality, rich in arts, culture, and food. We respect the spirit of “Omotenashi” and Japanese vibrant traditions. We have already learned so much from Japan that we have been able to export to other markets in which we operate.”

Source: Japan approves building of first casino, The Guardian, April 14, 2023

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