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Japan Casino Bill Approved by Cabinet, Authorizes Three Integrated Resorts

The long-awaited Japan casino regulatory bill is finally here.

Shinzo Abe’s 20-member cabinet has sent its Japan casino bill to the country’s National Diet for final approval. (Image: Kyodo News)

On Friday, Prime Minister Shinzo Abe’s Cabinet approved the measure that seeks to authorize commercial integrated casino resorts. The statute initially calls for three gambling properties, with taxes on gross revenues set at 30 percent and residents charged a JPY 6,000 ($55) entrance fee while granting free access to foreigners.

“We will promote tourism with visitors from all over the world spending days at the casino resorts, while taking complete measures to address various concerns including gambling addiction,” Abe said during a Friday cabinet meeting.

Japan’s lawmaking body, the National Diet, passed a statute in December 2016 that legalized gambling. The bill called for the creation of a more in-depth regulatory act, which brings us to today.

With the cabinet’s approval of the Japan casino bill, the decree now heads to the Diet’s two chambers for review. Abe has called on the legislature to pass the measure into law before it adjourns on June 20.

Operators Rejoice

Every major casino operator in the world is fixated on Japan. Las Vegas Sands and MGM Resorts are seen as the frontrunners for two of the licenses, but companies such as Wynn Resorts, Galaxy Entertainment, Melco Resorts, Caesars Entertainment, and Hard Rock have all expressed keen interest in bidding.

Several billionaire company CEOs have floated lofty investment numbers as high as $10 billion should they land one of the coveted operating permits. The massive numbers, however, were on condition that the Japan government outlay favorable conditions.

Upon first glance of the casino bill, at least one operator seems pleased.

“We haven’t seen anything in the Japanese casino legislation that isn’t manageable,” Melco Resorts CFO Geoffrey Davis told The Japan Times.

Lawrence Ho, the billionaire founder of Melco, said recently that the company would spend “more than $10 billion” if welcomed in Japan. He earlier declared that unlike competitor Sheldon Adelson and Las Vegas Sands, which pledged a $10 billion investment, Ho prefers “not to constrain our dreams with price tags.”

The casino bill doesn’t specify where the IRs are to be built, but Osaka, Yokohama, and Tokyo are thought to be the likeliest hosts. Operators, according to the cabinet measure, will need to submit thorough business plans with specific safeguards to prevent problem gambling.

How Bill Becomes Law in Japan

Unlike in the United States, Japan’s legislative unit rarely initiates meaningful legislation. Instead, the lawmaking body receives and reviews measures, typically from the prime minister’s cabinet.

Shinzo Abe directed his cabinet and controlling Liberal Democratic Party (LDP) to pass casino laws in order to grow tourism in Japan. Though there’s plenty of public opposition to authorizing commercial gambling, the measure is expected to pass the Diet due to LDP’s strong majority.

The LDP and its coalition party partner Komeito hold 150 seats in the House of Councillors’ 242-member chamber. It additionally has 312 legislators of the House of Representatives’ 465 positions.

When both chambers of the Diet pass a bill, it is enacted into law.

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