While gaming (including lottery and sports betting products) has been permitted in Singapore for more than 40 years, casinos have only recently been permitted to operate in Singapore in accordance with the Casino Control Act (Chapter 33A) Singapore.
The Casino Control Act was passed in 2006 and limits the number of casinos operating in Singapore to two, at least until April 2017 when the period for the restriction of two casinos under the act expires, unless the Singapore government amends or extends this period. 1
Following a tender process in 2005, the following companies were selected as the operators to establish integrated resorts: Genting International, which established the integrated resort known as Resorts World Sentosa; and Las Vegas Sands, which established the integrated resort known as Marina Bay Sands.
Under the Casino Control Act, an integrated resort is a “development comprising hotel, retail, dining, entertainment, recreation and other facilities, and of which a casino may be a part.”2
Resorts World Sentosa and Marina Bay Sands both opened in 2010, and their opening has changed the tourism landscape in Singapore. According to the Singapore Tourism Board, in 2011 and 2012 Singapore welcomed a record-breaking number of international visitors and tourism receipts year on year. 3
In 2011, Marina Bay Sands and Resorts World Sentosa had a publicly declared combined gaming revenue of U.S. $5.42 billion. In comparison, in 2011 the 55 casinos in the Las Vegas Strip area produced U.S. $6.068 billion in gaming revenue. 4
According to the Ministry of Trade and Industry, Marina Bay Sands and Resorts World Sentosa support more than 40,000 jobs, including jobs in retail, food and beverage and transportation. 5
The Singapore government is taking a considered approach in the development of the gaming sector, particularly regarding the social impacts associated with gaming. Like most jurisdictions, gaming is a heavily regulated industry in Singapore. As part of the Singapore government’s commitment to monitoring the impact of the gaming industry, changes to the initial regulatory framework have been implemented. This article provides an update on these regulatory developments.
The Casino Control Act is the main legislative framework for the regulation of casinos in Singapore. The act covers many different areas, including the licensing of casinos; the supervision and control of casino operators; casino operations; and social safeguard provisions, such as the imposition of entry levies, exclusion orders and the establishment of the National Council on Problem Gaming.
The act also established the Casino Regulatory Authority of Singapore (CRA) to maintain and administer systems for the licensing, supervision and control of casinos.6 The CRA’s role is to consider international best practices adopted by other major gaming jurisdictions and then develop and enhance such practices to cater to local requirements. For example, the CRA has closely followed the inspection framework in Nevada and Queensland, Australia. The current audit and inspection model in Singapore involves comprehensive checks on more than 15 different aspects of gaming operations to see if the operators have implemented the internal controls required by the Casino Control Act.7
It is also interesting to note that the Minister for Home Affairs may, after consultation with the CRA, cancel a casino license if it appears to the minister to be in the public interest to do so.8 The decision of the minister is final, and if there is any doubt as to whether or not such cancellation is in the public interest, then a certificate signed by the minister will be considered “conclusive evidence.”9 The minister shall pay fair compensation to the operator for the cancellation of a license.10
A casino is not permitted to operate without a casino license.11 When considering an application for a casino license, the CRA considers whether the applicant is a “suitable person.”12 As part of this determination, the CRA will consider a number of factors, including the applicant‘s reputation13 and business ability.14
Recent amendments to the Casino Control Act require the CRA to also consider whether the applicant is a suitable person to develop, maintain and promote an integrated resort “as a competing tourist destination that meets prevailing market demand and industry standards, and contributes to the tourism industry in Singapore.”15 This additional requirement has been introduced to encourage the development of non-gaming facilities at the integrated resort.
The Singapore government has stepped up its enforcement efforts by conducting more thorough and frequent checks of the integrated resorts. According to statistics released by the CRA, in the first two months of 2013, the CRA undertook nine enforcement actions against the two integrated resort operators, compared to four enforcement actions in the entirety of 2011 and 13 enforcement actions in 2012.16
With respect to the 2013 enforcement actions, three were related to breaches by Marina Bay Sands of the Casino Control (Surveillance) Regulations 2009. The CRA imposed financial penalties on Marina Bay Sands of:
• S.G.$150,000 for failing to retain specified casino surveillance footage;
• S.G.$100,000 for failing to ensure continuous recording of specified casino surveillance footage; and
• S.G.$225,000 for failing to have a failure notification system that provides an audible, as well as visual, notification of specific failures in the surveillance system.17
In 2011, Resorts World Sentosa was fined S.G. $330,000 for similarly contravening the regulations with respect to surveillance.18
In other recent enforcement actions, both Marina Bay Sands and Resorts World Sentosa were each fined between S.G. $100,000 and S.G. $130,000 for failing to prevent Singaporeans or permanent residents without valid entry levies, minors and excluded persons from entering into and/or remaining on the casino premises.19
In 2012, enforcement actions were brought against Resorts World Sentosa for partially reimbursing the annual entry levy paid by Singaporeans or permanent residents. The partial reimbursement was found to be achieved through marketing programs that gave incentives such as theme park tickets, concert tickets and hotel accommodation when an annual entry levy was either purchased or renewed. The marketing period went from Feb. 1, 2011, to May 31, 2011, and Resorts World Sentosa was fined S.G. $600,000.20
Recent Legislative Changes
Further changes to the Casino Control Act were introduced earlier this year. The Casino Control (Amendment) Act 2012 (No. 36 of 2012) came into force on Jan. 31, 2013. The changes included:
• Establishing an independent evaluation panel to evaluate the non-gaming aspects of integrated resorts. This attempts to link the granting and renewal of a casino license with the ability of an integrated resort to develop attractions that are not gaming related. Factors that the panel are to consider in its evaluation include: 21
– visitor appeal of the integrated resort;
– the comparability of the integrated resort to similar attractions or facilities internationally;
– the degree to which the integrated resort meets the prevailing market demand; and
– the contribution of the integrated resort to the tourism industry in Singapore.
• Raising the maximum financial penalty that the casino operators may face from S.G.$1 million to 10 percent of the annual gross gaming revenue.22
• Establishing more stringent requirements in relation to “international market agents.”23 An international market agent must be licensed and may perform certain activities, including:
– Organizing or conducting a casino marketing arrangement to people other than a Singaporean or a permanent resident. A “casino marketing arrangement” is where the international market agent receives commission from the casino operator that is based on the turnover of play in the casino of a person introduced by the international market agent; and
– Giving chips on credit to any patron participating in a casino marketing arrangement.24
The introduction of more stringent requirements for international market agents may have the effect of restricting the growth of certain business areas within the integrated resorts in Singapore. If there are limited international market agents who can provide credit to patrons, then the operator may be required to provide credit and bear the risk.25
Social Impacts and Safeguards
Concern over the social impacts relating to casinos is one of the reasons that the development of casinos has only recently occurred in Singapore. It was thought that “by making gaming more accessible and even glamorous, it could encourage more gambling and increase the risk of gaming addiction.”26 It was hoped that the establishment of integrated resorts, rather than stand alone casinos, would mitigate these potential negative impacts.27
The National Council for Problem Gambling was established as part of the Casino Control Act in order to address concerns over the social impacts of gaming in Singapore.28 The establishment of the National Council for Problem Gambling was seen to be “pre-emptive and proactive” ahead of any problems following the commencement of the act.29
Concerns over the social impacts in Singapore have also resulted in a levy being imposed on the entry to the casinos by Singaporeans and permanent residents. In order to access casino premises in Singapore, Singaporeans and permanent residents are required to pay S.G.$100 for one day or S.G.$2,000 for one year.30
Recent developments to the Casino Control Act also include strengthening social safeguard measures by allowing families and individuals to apply for visit limits and encouraging more family- or self-imposed exclusions. Visit limits are for a specific period of time and may specify a maximum number of visits to any casino in a each month. A visit limit on a person can be applied for by a family member and may be imposed when the person may be engaged in gaming “in disregard of the needs and welfare of the [person’s] family members.”31
We hope that this article has provided some insight into the regulatory developments for the gaming industry in Singapore and how Singapore continues to seek to balance gaming regulation while monitoring and attempting to ameliorate the social impacts of gaming.
It will be interesting to see how the regulatory framework develops in Singapore, including whether a rumored third license will be issued in the future and whether the concerns around the social impacts of gaming will result in further regulation.
Author’s Note: As of this issue going to press, the CRA announced the renewal of casino licenses for both Resorts World Sentosa and Marina Bay Sands for a further three years. The renewed license for Marina Bay Sands will expire on April 25, 2016 and the renewed license for Resorts World Sentosa will expire on Feb. 5, 2016.
Written in collaboration with Alison Tonges, Associate, Ashurst and Yvonne Shi, Associate, Ashurst – Singapore office.
This article is not intended to provide Singapore law advice or to provide a comprehensive review of all developments in the law and practice or to cover all aspects of the matters referred to in this article. For more information please contact us at 11/F, Jardine House, 1 Connaught Place, Central, T: +852 2846 8989 F: +852 2868 0898 www.ashurst.com.
1 Section 41(1) Casino Control Act (Chapter 33A) and Casino Control (Designated Second Site) Order 2012.
2 Section 2(1) Casino Control Act (Chapter 33A).
3 According to the Singapore Tourism Board Annual Report 2011/2012, international visitor arrivals to Singapore increased by 13 percent from the previous year to a new record of 13.2 million in 2011 and cumulative tourism receipts grew year on year by 18 per cent to a record high of S$22.3 billion.
4 “Singapore exercising care with junkets”, Howard Stutz, Las Vegas Review Journal, 1 April 2012.
5 http://www.mti.gov.sg/MTIInsights/Pages/Integrated%20Resorts.aspx, accessed on 2 April 2013.
6 Section 8 Casino Control Act (Chapter 33A).
7 Speech by Mr Richard Magnus, Chairman CRA, “CRA Workplan Seminar 2012”, 24 May 2012, available online at http://app.cra.gov.sg/public/www/speech_item.aspx?sid=163
8 Section 4(1) Casino Control Act (Chapter 33A).
9 Sections 4(8) and 4(7) Casino Control Act (Chapter 33A).
10 Section 4(4) Casino Control Act (Chapter 33A).
11 Section 43(1) Casino Control Act (Chapter 33A).
12 Section 45(1) Casino Control Act (Chapter 33A).
13 Section 45(2)(a) Casino Control Act (Chapter 33A).
14 Section 45(2)(e) Casino Control Act (Chapter 33A).
15 Section 45(2)(ha) Casino Control Act (Chapter 33A).
16 http://app.cra.gov.sg/public/www/content.aspx?sid=137, accessed on 18 March 2013.
21 Section 45A Casino Control Act (Chapter 33A) and Section 10 Casino Control (Amendment) Act 2012 (No 36 of 2012).
22 Section 54(1) Casino Control Act (Chapter 33A) and Section 15(a) Casino Control (Amendment) Act 2012 (No 36 of 2012).
23 Sections 110-110C Casino Control Act (Chapter 33A) and Section 45 Casino Control (Amendment) Act 2012 (No 36 of 2012).
24 Sections 110A(2) and 110(2) Casino Control Act (Chapter 33A) and Section 45 Casino Control (Amendment) Act 2012 (No 36 of 2012).
25 “PH gaming seen to surpass Singapore’s”, Doris C Dumlao, Philippine Daily Inquirer, 28 February 2013.
26 “Proposal to Develop Integrated Resorts”, statement by Prime Minister Lee Hsien Loong on Integrated Resort on Monday, 18 April 2005 at Parliament House, available online at http://www.mti.gov.sg/MTIInsights/Documents/Ministerial%20Statement%20-%….
29 “Singapore’s cautious approach to casino liberalization”, Asialaw, July 2008, available online at http://www.asialaw.com/Article/2004335/Channel/16715/Singapores-cautious….
30 s 116(1) Casino Control Act (Chapter 33A).
31 Section 84 Casino Control (Amendment) Act 2012 (No 36 of 2012).