photo contributed by Revenal Toribio
InterAksyon.com
The online news portal of TV5
SINGAPORE - In any casino, the odds favour the house. Using its house edge, Singapore is seeking to maximise economic profits and minimise social costs with tighter rules and tougher fines for two casino operators, along with new steps to curb problem gambling.
The wealthy and regimented city-state has enjoyed a windfall of tourism, jobs and revenue since Las Vegas Sands Corp and Genting Singapore Plc opened casino complexes in 2010, in part by linking their licences to how well they develop attractions that are not related to gambling.
Under that mandate, the two operators have added theme parks, museums, theatres and high-end hotels, boutiques and restaurants to Singapore's landscape as the Asian business hub recasts itself as a global city and oasis for the rich.
Amendments to the Casino Control Act cleared parliament late last year and now await formal passage into law, giving the operators of Marina Bay Sands and Resorts World Sentosa little choice but to adapt to the new rules - including fines of up to 10 percent of gaming revenue - and the costs of compliance.
"It is timely that the legislation be reviewed and further tweaks be made to ensure that the objectives of setting up the integrated resorts are achieved," said Yap Wai Ming, a partner at Stamford Law Corp who tracks casino regulation. "They have already invested billions of dollars and the casinos are still generating very healthy profits despite the enforcement actions."
Marina Bay Sands declined to comment on Singapore's new rules and a spokeswoman did not respond to another query about the prospects for its non-gaming business.
Lim Kok Thay, chairman of Genting Bhd, said last month he expects tourists to play a big part in Resorts World Sentosa's growth and its non-gambling business to continue to do better than the gaming side that brings in the bulk of revenues.
Social cots
Although casino takings have dipped as some of the novelty wears off on a small island of 5.3 million people, earnings at both resorts likely topped $1 billion last year as visitors poured in from China, Indonesia, Malaysia and further afield.
But there are rumblings about social ills. Some lawmakers question whether Singapore really needs casinos and counsellors say they see more people who cannot control their betting.
For Jimmy, the opening of the two all-hours casinos pulled him back into a gambling addiction he had managed to keep in check for 14 years, sending his world crashing down with losses of S$250,000 ($203,000) over 13 months at the Baccarat tables.
"Casinos did bring more jobs, more visibility for Singapore, more economic benefits," said the education professional, who is now free of debt and in counselling. "Yet it's also undeniably true that the undercurrents behind these benefits are there too - broken families and ruined lives and the increased social costs that come with it."
Fines and bans
Lee Kuan Yew, Singapore's founding leader and influential elder statesman, resisted casinos for decades. He finally relented, he told National Geographic magazine in 2009, when younger colleagues said "we must have a casino, otherwise we are out of the circuit of this fast set that goes around the world."
The government, which makes citizens and permanent residents pay a casino entry levy of S$100 a day or S$2,000 for an annual pass as part of efforts to deter problem gambling, shows no sign of abandoning its support for the two resorts.
But Las Vegas Sands and Genting Singapore could see fewer locals in their casinos under the new rules and risk much costlier punishments for breaking them.
The operators, which have been fined for admitting minors and failing to collect the levy for the government, will face a maximum penalty of 10 percent of annual gross gaming revenue. The current cap on fines is S$1 million but, if fully enforced, the new ceiling could be closer to S$200 million.
A panel will also be set up by the trade ministry to help the Casino Regulatory Authority determine how attractive the resorts are as tourist destinations - an assessment that will apply to the renewal of their casino licences from January 2015.
"Protecting vulnerable groups and the society at large from the harm of casino gambling is another priority," S. Iswaran, Singapore's second minister for trade, said in October.
For those deemed to be at risk, the new rules include a monthly limit on casino visits to bolster existing safeguards.
Under a programme now run by the National Council on Problem Gambling, more than 85,000 people have banned themselves from the casinos and nearly 1,300 more were excluded at the request of family members, the latest data shows. Another 43,000 people who are bankrupt or get state aid are automatically banned.
Singapore's "archaic and outdated" rules on Internet betting are a future target for changes, said Yap at Stamford Law. "Problem gambling and massive tax leakages and lack of visibility continue to pervade this sector," he said.
"This is a space to watch."
Global appeal
For Genting Singapore, gaming revenues at Resorts World Sentosa fell 15 percent in the first nine months of last year from the same period of 2011. Analysts have cut earnings estimates and downgraded the stock.
Third-quarter casino revenues at Marina Bay Sands fell nearly 30 percent, Las Vegas Sands said. Still, the Singapore casino had a gross profit margin above 40 percent - higher than any of the company's U.S. and Macau properties.
Despite the tougher climate, the money rolls in.
"The domestic market is the one that gives you the adrenaline rush when it first opens, but it will be sustained by inflow from the foreign players," said Genting's Lim.
"As we open more facilities, that will give us an edge in marketing overseas and in telling the world we are not just a gaming resort, but we have other things for families to do. It does help us in our gaming revenue."
($1 = 1.2295 Singapore dollars)
(Additional reporting by Anshuman Daga and Charmian Kok)
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