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Gaming Legal & Regulatory

Nepal govt to bring new law to regulate casinos

The Nepalese government has announced that it will be submitting a new casino bill aimed at encouraging foreign investment into the sector, and bring its existing casinos in line, as per local media reports.

“We will be submitting a draft to the Cabinet next week for its approval in principle to prepare a Casino Bill 2018,” said tourism ministry spokesman Ghanshyam Upadhyay as per a report in The Kathmandu Post.

“The Law Ministry has given its okay to a preliminary draft. After the Cabinet’s approval, we will begin to draft the bill. The move to introduce the Casino Act is to enhance investment and employment in the industry which is expected to grow quickly,” he said.

While the new law is touted to increase foreign investment in the industry, reports indicate that the sole objective of the new Act is to bring existing casinos in line as they have been operating freely without paying taxes and royalties to the government.

This is due to an interim order from the Supreme Court in 2016 that essentially has allowed operators to continue operating whilst only paying a portion of what they owe.

“The most complicated matter for the department is that it cannot collect taxes and royalties as it has scrapped their licenses. In the legal sense, the casinos are operating unlawfully. But, we have to honor the court’s ruling,” said an unnamed official from the Department of Tourism.

The new Casino Act will supersede the Casino Regulation 2013, which currently govern casinos in the country and also the Supreme Court’s orders, said officials.

“It will also regulate the casinos in a more managed way and protect the investment of foreign investors”, said the unnamed government official as per The Kathmandu Post.

According to the recently released budget statement, there are seven casinos operating in the country. However, there are three other casinos still running as a result of a court order.

Categories
Legal & Regulatory

Senior Goa minister in favour of legalising matka gambling

Goa Law Minister and one of the seniormost leaders of the Bharatiya Janata Party (BJP) in the state, Francis D’Souza, supported the idea of legalisation of matka gambling in the state, as per media reports.

“I feel legalising matka is one of the options and it has to be tried since we can’t end the problem,” said D’Souza according to news reports.

He also remarked that if gambling is allowed on a big scale in Goa in the form of casinos then even matka (a form of lottery) should be allowed.

D’Souza added that since gambling and betting is a state subject, the Goa government can enact a law on the subject without waiting for any law or directions from the centre. He further stated that there should be a solution to the matka gambling problem in the state.

“Matka happens everywhere. Do you hear of police conducting searches anywhere?” he asked.

The Goa government had formed a special investigation team (SIT) to probe matka gambling in the state based on an order from the Goa bench of the Bombay High Court, following a petition by social activist Kashinath Shetye.

It is however believed that the SIT probe has slowly lost momentum after initial searches and raids by the authorities.

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Business

Silver Heritage Group appoints Australian entrepreneur as new chairman, directors agree to pay cut

Weeks after the resignation of its non-executive chairman David Green, Silver Heritage Group has announced that entrepreneur and investor James Spenceley will be the new non-executive chairman of the company with immediate effect.

Spenceley is a well-regarded entrepreneur in Australia and is the founder of Vocus Communication Ltd., Australia’s fourth largest telecommunications company. He also has interests in other sectors such as financial services, farming and sports.

The company also informed the Australian stock exchange that its current three non-executive directors ‘have agreed to waive half of their fees until the end of 2018.’

The Australia-listed company added that it expects aggregate annualized savings of Australian $375,000 (US$ 283,072) due ‘to these waivers, as well as the reduction from four independent non-executive directors to three.’

Managing Director and CEO for Silver Heritage Group, Mike Bolsover said that Spenceley is a “great addition” to its board and that after multiple visits to both Nepal and to Tiger Palace since its opening last year, “hits the ground running.”

In an investor presentation to its shareholders, Bolsover said that he was striving to take the company to profitability and noted that he was trying to bring in several cost control and cost reduction initiatives. He added that April 2018 was breakeven for the company as a whole and its Bhairahawa based Tiger Palace casino and resort would be breaking even by the third quarter of 2018.

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Business

One more Silver Heritage Group Director resigns

Days after Silver Heritage Group Chairman David Green announced that he was resigning from the board of the company with immediate effect due to personal reasons and to focus on his business interests, yet another director has quit the company.

Non-executive director Richard Barker announced that he was resigning from the company with immediate effect ‘to enable him to focus on other business interests.’

The announcement of the resignation, made by the company to the Australian Stock Exchange also informed the shareholders that Barker will not be standing for re-election to the board at the company’s Annual General Meeting (AGM). The company further stated that the resolution pertaining to Barker’s re-election will be withdrawn from the AGM’s agenda. Silver Heritage’s AGM is scheduled to be held on 25th May.

The Board of Director of Silver Heritage thanked Barker for his inputs and efforts during his tenure as a director. Barker is described on Silver Heritage’s website as an executive ‘specialised in mergers and acquisitions, capital raisings and corporate financial advice’.

With Barker and Green’s resignation, there are only three directors left on the board of the Australian Stock Exchange listed company.

Mike Bolsover continues to be the company’s Managing Director and CEO.  Apart from Bolsover, the company has two independent directors, Matthew Hunter and Robert Benussi.  Hunter functions as the company’s interim CEO after Green’s resignation.

In August 2017, company co-founder Tim Shepherd resigned from the board of the company but as of now he is still supporting the company as an advisor. The company is also embroiled in litigation with its local Nepalese partner Rajendra Bajgain, following allegations that the company’s foreign employees did not obtain proper visas before starting work at the flagship Tiger Palace resort in Bhairahawa.

The series of setbacks and resignations in the company raises concerns about whether the casino operator will be able to smoothly carry out its business in Nepal and Vietnam.

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Legal & Regulatory

Casino Strike gets interim relief from Bombay HC; allowed to resume operations on payment of Rs. 10 crores

The Goa bench of the Bombay High Court allowed Goan Hotels and Realty Pvt. Ltd., the company that operates Casino Strike in Grand Hyatt hotel, to resume operations on payment of a partial amount of Rs. 10 crores, in lieu of its license fee liability.  The High Court’s relief comes just one day after the government forced the casino to shutter operations for failure to pay the hiked license fees within the deadline and grace period.

Justice MS Sonak, who urgently heard the matter based on the company’s plea, noted that the company had made an application to reduce its area from the existing 1013 square metres to around 300 square metres, based on which its license fee liability for financial year 2018-19 would reduce from Rs. 40 crores to around Rs. 20 crores.

Justice Sonak also noted the state government’s response that the application for reduction of area is pending consideration and an appropriate decision is expected to be taken in around one week.

Based on the casino operator’s plea that it was ready to pay a partial amount of Rs. 10 crores immediately, to show its bona fides, the court asked the state government to issue a challan for payment of Rs. 10 crores.

The court also stated that if Casino Strike’s application for reduction of area is accepted by the government, then the balance amount of around Rs. 10 crores or thereabouts should be paid by the casino operator within three weeks of receipt of such communication.

The bench also stated that Casino Strike could resume operations once it pays the partial amount of Rs. 10 crores. After granting this partial interim relief, the High Court tagged the petition with Gopal Kanda’s Golden Globe Hotel’s (Big Daddy Casino’s) pending writ petition which also challenges the government’s decision to drastically hike license fees.

Both Casino Strike and Casino Big Daddy’s petitions are now scheduled to come up for hearing on 6th June, 2018.

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Business Gaming

License fee hike impact: 2 onshore Goa casinos shut shop, 1 more forced to shut down

Weeks after the Goa government drastically hiked recurring annual license fees payable by onshore and offshore casinos by almost 400%, at least three onshore casinos have shut down operations, citing inability to pay the increased levies.

The Crown Casino in  Hotel Crown and Carnival Casino in Marriott Hotel shut down operations last month due to the almost four fold increase in license fees, which has been described by the industry as harsh and draconian.

Further, the state government also shut down Casino Strike in Grand Hyatt Hotel yesterday after the company that operated the gaming house failed to pay the annual license fees within the deadline. Incidentally, Strike Casino was the biggest onshore casino in Goa until its closure.

As per news reports, the Strike Casino management failed to pay the revised license fees even within the extended deadline period of 8th May, after which the government was compelled to shut down the casino. News reports indicate that so far, five offshore and seven onshore casinos have paid the revised license fees.

One of the offshore casino operators, Gopal Kanda-backed Golden Globe Hotels Pvt. Ltd. (the company that operates the recently opened Big Daddy casino) has approached the Goa bench of the Bombay High Court seeking relaxation in the license fees and permission to pay the license fees in installments.

A division bench of Justices Prithviraj Chavan and NM Jamdar declined to grant interim relief to the company but noted that the petitioner could approach the vacation court for appropriate relief if a show cause notice is issued to it. The court has now posted the matter for hearing on 6th June.

Earlier, a bunch of casino operators had made a representation to the state government seeking reduction in the license fee hike but government officials had refused to concede to their demands.

The increase in license fee and closure of few casinos may result in consolidation of the gaming industry in the state and only a few operators may be able to survive and flourish.

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Events

AGB to host Asia Gaming Genealogy Tree on 16th May in Macau

In lieu of the 3rd edition of the Asia Gaming Awards, leading online gaming news publisher Asia Gaming Brief (AGB) is announcing the launch of one of its most ambitious projects – the Asia Gaming Genealogy Tree and Reunion Dinner, set to take place on Wednesday, 16 May, 2018 at St. Regis, Macau.

The “Asia Gaming Genealogy Tree” is a significant undertaking pioneered by AGB which will serve to map out the key connections and networks within Asia’s gaming industry and the company has announced that it will be joining forces with the famous ‘Suppliers Network Cocktail Party’, held each year during G2E Asia week.

An ongoing project, the Gaming Tree will identify and bring to light the network of people who have dedicated their careers to shaping the Asia Gaming Industry. Who did they work with and when, where have they gone since, and where are they now?

Whether you are new to the industry, or a seasoned veteran, the Gaming Tree will become an essential tool for identifying the keys movers & shakers in the industry and their respective networks.

As a pioneer in the industry, AGB has always been committed to constantly innovating and providing the industry with engaging projects and platforms that make a difference.

Along those lines, AGB will be replacing its existing “Asia Gaming Awards” event with the debut of the “Asia Gaming Genealogy Tree” and its accompanying Cocktails and Annual Reunion Dinner, set to take place on Wednesday, 16th May at St. Regis, Macau.

Over the years, the Gaming Tree will continue to grow in tandem with the industry, with each year’s update presented at the Annual Reunion Dinner, bringing together old friends and creating the opportunity for new connections.

More information can be found on the Asia Gaming Tree Facebook page here.

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Business

Silver Heritage chairman David Green resigns from board

David Green, the chairman and non-executive director of Australia-listed Silver Heritage Group has resigned from the board of the company with immediate effect, as per a regulatory filing by the company yesterday.

The company stated that Green had resigned ‘for both personal reasons and also to enable him to focus upon other business interests’.

The company also informed that non-executive independent director Matthew Hunter will function as interim chairman of the company until further notice.

In August 2017, Silver Heritage’s co-founder Tim Shepherd had resigned from the company’s board although he continues to be a shareholder and advisor.

The company is also facing litigation from its Nepalese partner Rajendra Bajgain and had terminated its consultancy agreement with him. The termination however was stayed by a local court in Nepal and the company is trying to enter into a settlement agreement with Bajgain.

Silver Heritage operates South Asia’s first integrated casino resort, viz. the Tiger Palace resort at Bhairahawa on the India-Nepal border. The company also operates casinos in Kathmandu and Vietnam.

The company recently reported a loss in terms of adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) for the first quarter of 2018, amounting to US$ 1.9 million.

The company also noted that the Tiger Palace resort had registered 7,500 unique members since its opening in December 2018 and experienced a total footfall of over 22,000 patrons. The total revenues from Tiger Palace resort in the first quarter of 2018 were around US$ 911,000, as per the company.

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Business Gaming

Goa govt drastically hikes casino license fees

Continuing with the trend of hiking recurring casino license fees at the end of every financial year, the BJP-led Goa government has announced that annual license fees for both onshore and offshore casinos would be hiked, with effect from 1st April, 2018.

As per media reports, the license fee for casino vessels that can accommodate upto 200 passengers has been hiked to Rs. 25 crore per annum, a 250% increase from the existing Rs. 10 crores. Similarly, the license fees for offshore casinos with a capacity of 201-400 passengers has been hiked to Rs. 30 crores and for those vessels having passenger capacity of over 400 persons has been hiked to Rs. 40 crores.

Application fees for onshore/land-based casinos and offshore casinos licence has been increased from Rs 20 lakh to Rs 50 lakh. Further, the non-refundable security deposit  for onshore and offshore casinos has been hiked from Rs 20 lakh to Rs 50 lakh, which is to be paid at the time of grant of new licence. The security deposit for renewal has been increased from Rs 10 lakh to Rs 25 lakh.

The state government has also raised fees for renewal of licence for both onshore and offshore casinos from Rs 30 lakh to Rs 1 crore. The government has also increased fees for transfer of licence for onshore casinos from Rs 10 crore to Rs 30 crore and for offshore casinos it has been increased from Rs 20 crore to Rs 50 crore.

The increase in license fees for various categories of onshore and offshore casinos are given in the table below:

Onshore casinos

Size License fees for FY 2017-18 Increased license fees for FY 2018-19
Up to 100 square metres Rs. 4 crore Rs. 10 crore
100-300 square metres Rs. 5 crore Rs. 20 crore
300-500 square metres Rs. 5.50 crores Rs. 25 crores
500-750 square metres Rs. 7 crores Rs. 32 crores
750-1000 square metres Rs. 8 crores Rs. 36 crores
Above 1,000 square metres Rs. 8.5 crores Rs. 40 crores

Offshore casinos

Passenger capacity License fees for FY 2017-18 Increased license fees for FY 2018-19
Upto 200 Rs. 10 crores Rs. 25 crores
200-400 Rs. 11 crores Rs. 30 crores
Above 400 Rs. 12 crores Rs. 40 crores

News reports also indicate that the offshore casinos, which were expected to be shifted out of the River Mandovi by 31st March, 2018 will be given a further extension of one year to remain within the territorial waters of the river or until a solution of shifting them elsewhere is found.

Categories
Gaming

Two day gala opening of Tiger Palace casino on 16-17 March

Australia-listed and Hong Kong-based Silver Heritage Group has announced a two day extravaganza to mark the formal launch of its Tiger Palace resort and casino, situated at Bhairawaha, on the Nepal side on the Indo-Nepal border.

The grand opening event, scheduled for 16th and 17th March will see dance performances by famous Ukrainian troops and Thai Dancers along with performances by Bollywood’s dance sensations, Natasa Stankovic and Poonam Pandey.

Spread over 22 acres of land, Tiger Palace Resort has 100  rooms and suites along with two private villas, offering uninterrupted scenic views of the mountains and forests surrounding the resort.

The casino in the resort has 44 gaming tables and more 200 electronic gaming machines. The resort amenities include various F&B outlets, a large swimming pool, and a dedicated kids club with a wide array of entertainment options for children. For wellness and relaxation, the resort’s spa offers variety of body treatments and massages, a gym, sauna and steam rooms.

For conferences, meetings, and weddings, Tiger Palace Resort offers multiple venues including a ballroom and an expansive function lawn that can accommodate up to 1,000 guests. The resort also features a 100-year-old Rana temple, which sets the scene perfectly for wedding functions.

Commenting on the development, Tim Shepherd, co-founder and senior advisor of Silver Heritage Group said, “Tiger Palace Resort is our first wholly owned and operated five-star integrated resort in Bhairahawa, Nepal. This resort forms a major part of the Silver Heritage Group’s core growth strategy of focusing on developing casino resorts on the Indo-Nepal border and capitalising on the strong demand from Indian customers for a wholesome entertainment destination.

The immediate target market for the resort comprises of the more than 15 million aspirational middle-class Indian citizens living within six hours of travel from the resort, in states including Delhi, Uttar Pradesh, Bihar and West Bengal.”

The soft-launch of the hotel portion of the resort was on 22nd September, 2017 while casino operations were started on 28th December, 2017.

The Tiger Palace resort, touted as the biggest casino resort in South Asia has seen several delays due to lack of regulatory approvals and fund crunch faced by the company due to costs of construction being higher than what was anticipated.

Recently, Silver Heritage Group was mired in a controversy, with the company through a regulatory filing, announcing that they had terminated their consultancy agreement with their local Nepalese partner, Rajendra Bajgain, after the later publicly accused the company of not obtaining necessary work permit for senior foreign staff members working at the Tiger Palace resort.