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Singapore Casino Legislation Update

BACKGROUNDThe CCA, first enacted in 2006, sets outthe key regulatory regime for regulationof casinos in the Integrated Resorts inSingapore. The objectives of the CCA areto prevent criminal infiltration intocasinos, ensure gaming integrity in casi-nos and protect vulnerable persons andsociety at large from the potential harmsof casino gaming.

The CCA is primarily administeredby the Casino Regulatory Authority ofSingapore (“CRA”). CRA is a statutoryboard under the purview of the Ministryof Home Affairs (“MHA”) in Singapore.MHA and CRA work closely with othergovernment stakeholders such as the Min-

istry of Social and Family Development,the Ministry of Finance and the Ministryof Trade and Industry to review thecasino regulatory regime.

The key drivers for the review of thecasino regulatory regime were: (i) to enhance the provisions for gamingregulation and where appropriate,streamline regulatory processes;

(ii) to strengthen law enforcement leversto deal with casino-related crime;

(iii) to broaden the framework of socialsafeguards;

(iv) to refine the regulatory regime to giveeffect to the economic intent of intro-ducing the Integrated Resorts inSingapore; and

(v) to improve tax administration.

Feedback on the amendments wasobtained from industry, government,community and religious sectors, and thegeneral public.

KEY AMENDMENTSGamingThe CCA was amended to clarify anexisting policy of CRA that the onus is onan applicant to prove his suitability toCRA2, and that any license or approvalthat may be granted under the CCA wouldbe a revocable privilege3.

The terms “junket promoter” and“junket representative” were amended torefer to “international market agent”(“IMA”) and “international market agentrepresentative” (“IMAR”) respectively, toreflect the international focus of the busi-ness. As a related amendment, the term“junket” would now be known as “casinomarketing arrangement.” In line with thepolicy intent that IMAs were permittedonly for the purpose of bringing in inter-national high-roller clients to Singapore’scasinos, casino marketing arrangementsinvolving Singapore Citizens or Perma-nent Residents (“SCPRs”) have been pro-hibited. Furthermore, CRA has been

The following legislative updatecovers the key amendments to theSingapore Casino Control Act

(Cap. 33A) (the “CCA”) which came intooperation in 2013.

The World’s most expensive stand alone casino property at

US$6.3 billion, Marina Bay Sandsdominates the skyline at Marina Bay in Singapore.

By Tan Teck Wang and Anne Goh

CASINO LAWYER • AUTUMN 2013 9

legislatively empowered to impose a cap onany commission payable by a casino oper-ator to an IMA. However, to-date, no suchcap has been imposed. CRA would alsohave the powers to suspend or cancel anIMA licence when it is in the public inter-est to do so. The maximum fine for illegalIMA activity has been raised fromS$300,000 to S$500,000, for a strongerdeterrent effect.

Next, a tiered approach to the impo-sition of financial penalties was introduced.Prior to the amendments, the maximumfinancial penalty for a breach by a casinooperator was S$1 million. With theamendments, an enhanced financialpenalty of up to 10% of a casino opera-tor’s annual gross gaming revenue may beimposed on the casino operator for aserious breach. A serious breach wouldinclude, inter alia: (i) a beach that mayseverely affect the integrity of casinooperations or that may severely underminesocial safeguards, (ii) a breach which arosefrom a systemic failure or multiple failuresin the management or operation of thecasino, or (iii) a breach which may be inju-rious to public interest.

To minimise the threat posed byunsuitable industry players to the indus-try, CRA would now have additional leversagainst unsuitable special employees,IMAs and IMARs. CRA may suspend aspecial employee’s licence pending conclu-sion of any inquiry or disciplinary pro-ceedings against the licence holder inspecified circumstances (for example, toprevent a threat to the security of the pub-lic or to casino operations, or where thespecial employee has been convicted of anoffence under the CCA). CRA also has theright to suspend or cancel an IMA licenceor an IMAR licence to prevent any threatto the security of the public or of casinooperations.

Also, independent test laboratorieswhich test gaming equipment for compli-ance with CRA’s technical standards mustnow be approved by CRA. This allowsCRA to have greater regulatory oversight

over such laboratories, which were previ-ously only subject to a contractual recog-nition by CRA.

Other gaming-related amendmentswere made to refine and streamlineprocesses for greater business flexibility.For example, CRA may allow casinos toimplement post contract notification ofcertain classes of controlled contracts (i.e.,the casinos would be permitted to enterinto the contracts before notification toCRA), instead of complying with a 28-dayprior notification period (i.e., in thisscenario, the casinos would have to seekapproval via a 28-day pre-contract notifica-tion process). Another example of creatingmore business flexibility is the replace-ment of an approval regime for simulatedgaming to a notification regime.

Law and OrderCasino operators are now required toensure that illegal betting activities andunlicensed casino marketing activities donot occur in the casinos. This measurecomplements the existing obligation forcasino operators to take steps to ensurethat criminal activities such as vice, illegalmoney-lending and disorderly behaviourdo not occur within the casinos. Specificcasino-related offences such as offences

relating to cheating at play, collusion andpossession of unlawful devices to counter-feit chips were created to make the CCA anall-encompassing piece of legislation todeal with the range of crimes whichcommonly take place within the casinos.

Social SafeguardsPrior to the amendments in 2013, SCPRswere already prohibited from receivingchips on credit unless they were premiumplayers (“PPs”)4. In addition to thisrequirement, the CCA was amended toallow CRA to prescribe proceduralrequirements in regulations for the exten-sion of chips on credit to SCPR PPs. Theregulations on credit were also amendedon 31 January 2013 to require a SCPR PPto register for a credit qualifying pro-gramme with the casino operator beforehe may obtain any chips on credit. Underthe credit qualifying programme, a SCPRPP may only obtain chips on credit wherehe has been shown to be able to put at riska minimum amount of S$100,000 on gam-ing (which should be his capital and not in-clude any winnings), and the casinooperator has assessed that the SCPR PP iscredit-worthy.

A casino operator would also have toimplement a responsible gambling pro-gramme which complies with a responsi-ble gambling code to be issued by CRA. Aresponsible gambling programme wouldbe subject to CRA’s approval. A casino op-erator would also have to conduct regularreviews and international benchmarkingexercises to ensure that responsiblegambling measures remain up-to-date andrelevant. CRA may also require a specialaudit to be conducted on a casino opera-tor’s responsible gambling programme, oradvertising or promotion campaigns, atthe casino operator’s costs.

A new visit limit regime targeted atprotecting local patrons who are finan-cially vulnerable was also introduced. Avisit limit is a cap on the number of timesthat an individual may enter a casino per

“Casino operators arenow required to ensure

that illegal betting activitiesand unlicensed casino marketing activities do not occur in the casinos.

This measure complementsthe existing obligation forcasino operators to take

steps to ensure that criminalactivities such as vice,

illegal money-lending anddisorderly behaviour do notoccur within the casinos.”

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month. The cap would differ from indi-vidual to individual depending on his orher circumstances. Once the visit limit isreached, the individual becomes excludedfrom the casino for the remainder of themonth in which the visit limit is reached.The visit limit regime complements theexisting range of social safeguards suchas exclusion orders to protect financiallyvulnerable locals from the potential harmsof casino gaming. Individuals and fami-lies may apply to the National Council onProblem Gambling (“NCPG”) on volun-tary self-imposed visit limits and familyvisit limits, respectively. In addition,NCPG would be empowered to appoint aCommittee of Assessors to determinewhether NCPG should impose a visit limiton a financially vulnerable local.

Alignment with Economic IntentCRA would, with effect from 1 January2015, take into account an applicant’sability to maintain, promote and developan Integrated Resort as a compellingtourist destination when assessingwhether to grant or renew a casino

licence. This would be consideredtogether with other requirements forsuitability, such as the lack of criminallinks and social safeguards.

The Minister responsible for tourismdevelopment and promotion would beempowered to appoint an evaluation panel(“EP”). The EP would provide an inde-pendent opinion to CRA on the ability ofthe casino operator to fulfil its economicobligations to the Singapore Government.The casino operator’s ability to do sowould be considered based on a widerange of indicators such as visitor appealand trends, industry standards, bench-marks with similar international attrac-tions and tourism contributions.

Tax The Minister for Finance was empow-ered to prescribe obligations of thecasino operator for tracking revenueattributed to premium players. The reg-ulations on casino tax were alsoamended to set out the requirements onthe classifying and verifying of grossgaming revenue from PPs and non-PPsas the tax rates arising from the play ofeach category are different.

CONCLUSIONThese amendments reflect the Govern-ment’s objective to ensure that theregulatory regime remain sufficiently ro-bust to meet potential challenges posed bythe ever evolving gaming industry. Thecasino regulatory regime will be contin-ually reviewed to ensure that it remainsrelevant. �

Singapore’s government hasimposed certain restrictions to

prevent the spread of organizedcrime and social ills that often

plague the casino gaming cities.

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1 This Singapore Casino Legislative Update is writ-ten by Mr. Tan Teck Wang, General Counsel andMs. Anne Goh, Assistant General Counsel, both ofthe Casino Regulatory Authority of Singapore. 2 Section 185B(1) of the CCA reads: “Where theAuthority is required to be satisfied that any appli-cant for a licence or an approval, or any otherperson connected to the application, is suitable orqualified for the purposes of the licence orapproval, the burden of proving that suitability orqualification shall be on the applicant and eachother person connected to the application, as thecase may be.”3 Section 185A of the CCA reads: “For the avoid-ance of doubt, any licence or approval grantedunder this Act is a revocable privilege.”4 A premium player is defined in section 2 of theCCA and generally refers to a patron of a casinowho opens a deposit account with the casino oper-ator with a credit balance of not less than$100,000.