Galaxy Entertainment Group Limited has reportedly followed fellow Macau casino operators Melco Resorts and Entertainment Limited and Wynn Macau Limited in publicly announcing that it is no longer working with junket firms.
According to a report from GGRAsia, the Hong Kong-listed firm used an official filing to declare that ‘there are no gaming promoters currently operating’ within any of its Macau casinos although it declined to officially reveal when this policy had been implemented. The source also detailed that the operator had widely been perceived as one of the leaders in serving high-value gamblers at its impressive Broadway Macau, Galaxy Macau and StarWorld Macau properties before the emergence of the coronavirus pandemic in early-2020.
Macau is currently home to approximately 85 junket firms that reportedly receive a commission for promoting partner casinos to wealthy gamblers while simultaneously handling such VIP’s travel, accommodation and foreign banking or credit needs for amounts that can often run into the millions of dollars. However, the number of such local enterprises has purportedly been steadily declining since reaching a high of 235 in 2013 on the back of allegations they may often have links to unscrupulous individuals and organized crime syndicates.
GGRAsia reported that the move from Galaxy Entertainment Group Limited comes after junket giants Tak Chun Group and Suncity Group had their contracts with Macau’s six licensed casino operators unilaterally cancelled late last year. This latter enterprise moreover hit the headlines in November when its Chief Executive Officer and largest shareholder, Alvin Chau Cheok Wa, was arrested in China on charges that he had helped to facilitate illegal cross-border gambling.
The decision from Galaxy Entertainment Group Limited could also reportedly be down to the fact that Macau’s draft gaming bill, which is set to be put before legislators on Monday, contains a clause that would prohibit local casino firms from inking profit-sharing deals with junket enterprises and outside management entities. The operator’s current 20-year license is set to expire in June and it will purportedly want to be seen as being in compliance ahead of an anticipated bid for a new ten-year concession.
Finally, GGRAsia reported that there may well be an economic element to the decisions from Galaxy Entertainment Group Limited, Melco Resorts and Entertainment Limited and Wynn Macau Limited to abandon their use of junkets. Games of VIP baccarat purportedly generated almost half of the former Portuguese enclave’s around $36.47 billion in aggregated gross gaming revenues for 2019 although this ratio dropped for the final three months of last year to stand at only about 25.7%.