IAG Interviews Kwok Chi Chung on Future Macau Junket Changes

As junket operators are increasingly under pressure in Macau, Inside Asia Gaming (IAG) spoke with Kwok Chi Chung, the president of the Macau Association of Gaming and Entertainment Promoters, to discuss the fresh challenges the industry faces. This followed a meeting between the Gaming Inspection and Coordination Bureau (DICJ) and junket operators’ representatives. 

Kwok remained optimistic about a possible solution that would allow junkets to continue operating in Macau, albeit some aspects of the future arrangement remain unsettled. For example, junkets are still in the dark as to their operation’s scope. One proposal could see each junket work with a single casino only.

One Junket Per Casino Partner

This comes at a time when some of the bigger casinos in the special administrative region, including Melco, Wynn, and Las Vegas Sands, have decided to sever their ties with junkets, citing regulatory fears. Some have even said that junkets aren’t that important. What seems to be already clear is that junkets will have to forego revenue share agreements.

Instead, they would receive commissions on chips that have been spent at gaming tables in casinos. Junkets will no longer have dedicated rooms on casino floors and have to operate less conspicuously at Macau’s casino floors, it seems. 

Kwok remained optimistic about the future of the junket industry, which would no doubt undergo some serious transformation to survive. In Kwok’s opinion, junkets have been a part of the gaming industry even before Dr Stanley Ho began transforming Macau into a hub for gambling in Asia.

Kwok believes that the government is interested not so much in shutting down junkets completely but rather in introducing a new sustainable regulatory model. He explained that illegal businesses have been discovered in recent years, making Macau more determined to eradicate those. 

The recent arrest of Levo Chan Weng Lin and the arrest of Alvin Chau has sent a clear sign that junket operators will undergo some serious changes. Even the number of available licenses has dropped two-fold since 2021. 

Some Clarity about Future Regulation Needed

However, Kwok does not seem much to worry about in the latest round of discussions. According to him, junkets used to work in the way that Macau now wants to establish as the norm. That would pose no threat to junkets who wish to operate legally, Kwok said.

Some details remain to be straightened up, Kwok admits. For example, the idea of one junket operator teaming up with a single casino is not all that alien. However, what needs clarification is whether junket operators are free to change their partners freely or if they need to drop their licenses and seek to re-establish them with a new partner.

The role of agents on casino floors is also vague as agents would have to replace promoters. They may also be allowed to work with multiple junket operators, but this does not make much sense as junkets themselves are restricted to only one casino license, Kwok told IAG. 

Junket operators are undergoing a serious paradigm shift that is not going to be as devastating as initially thought. If anything, Macau may be able to bring an industry some of whose players have got used to coloring around the lines. Now, they would have to go on the straight and narrow instead.