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Learn from overseas markets and customise Japan’s model

By - 23 March 2021

In an exclusive interview with G3, Ayako Nakayama, Representative Director of the Japan Integrated Resort Association, discusses the future of the Integrated Resort sector in Japan and the role the association its playing in the unfolding saga.

Can you tell us a little about the Japan IR Association?

Japan Integrated Resort (IR) Association was set up in 2014 as a general incorporated association to facilitate the emerging Integrated Resort industry in Japan with the goal of making alliances with various industry stakeholders domestically and internationally.

Japan IR Association has organised seminars to government stakeholders and as well private sectors for industry topics. Japan IR Association currently offers ranges of activities to various industry stakeholders in forms of membership, committee activities, and forums to lead the up-to-date discussions of Japan IR.

The Basic Policy on IR was released in December – can you provide an outline of what this includes and what happens next?

The Basic Policy, issued by the Ministry of Land, Infrastructure, Transport and Tourism finalised the draft in December 2020. It includes an updated submission application deadline of April 28, 2022 to national government by municipalities with a delay of nine months period from the initial timeline set.

The guidelines also introduced infectious disease countermeasures for inside Integrated Resorts and the rules on interaction between private Integrated Resort operators and government officials with strict compliance countermeasures reflecting the fairness and transparency of the process by the national government.

The timeline for 2021 is to expect a draft of casino basic regulation by the Japan Casino Regulatory Committee, which will be a basic regulation of gaming to be submitted in the next several months. Regional processes have been accelerating insomuch that operator selection processes in prefectures/cities have been actively scheduled for the spring/summer of 2021.

What is the current situation regarding RFPs in each of the four interested prefectures?

Osaka, the most advanced in the process, already finished RFP in early 2020. MGM (with Orix) is the only candidate operator (consortium) for the region who will continue to be in the process of discussions with the prefecture of Osaka.

Yokohama has just announced the RFP processes with the timeline of choosing an operator by this summer. Yokohama has recently rejected a referendum over the Integrated Resort. The city will have a city mayor election this summer and its progress has cross-industry attention.

Wakayama started the RFP in January 2020 with the timeline of choosing an operator by this spring. Nagasaki started the RPF process as of January 2021 with the timeline of choosing an operator by this summer.

Which operating companies are still interested in operating casinos in each of the prefectures?

The city of Yokohama announced five companies – Melco Resorts & Entertainment, Galaxy Entertainment, Genting Singapore, Sega Sammy Holdings and SHOTOKU- all participated in their second RFC processes implemented in Autumn 2020.

The prefecture of Wakayama announced Clairvest Neem Ventures and Suncity Holdings Japan have participated and passed their initial assessment of the RFP in the middle of January 2021.

The prefecture of Nagasaki has announced Oshidori International Holdings Limited, Casinos Austria International Japan, and Current have all participated the PRC processes in October 2020. Recent news reported Pixel Companyz is showing an interest in the prefecture.

Of course there are delays following the Covid- 19 pandemic – will things get back on track this year? What are the main problems facing IR plans?

Covid-19 is certainly the variable to Integrated Industry and its process. National government has made progress on the process of IR such as the formal launch of the Basic Policy in 2020, which could be seen as significant progress under such circumstances of COVID-19 and political struggle over the circumstances.

2021 will be an extremely important year for Japan Integrated Resort industry as several municipalities are launching RFP processes to prepare for the national application period starting October 2021.

This timeline includes a controversial aspect within the industry considering recent COVID- 19 emergency state which has been issued by major cities, including Tokyo with its surrounding area, with an expected end of February 7 2021. The national government is considering an extension of the state for up to one month depending on the number of COVID- 19 cases in the next two weeks.

Under current conditions, most of the foreign visitors are not allowed to travel which could potentially negatively influence selection processes. Uncertainties of political, social, and economical influences by COVID-19 in 2021 will be the challenging aspect for Japan IR progresses and its plans.

What’s the future outlook for the IR projects in Japan in light of all the problems COVID-19 has caused? What are the positives?

COVID -19 has drastically changed the future outlook of the international market and its prospect. Considering Japan Integrated Resort is modelled on the Singapore style IR scheme and its success of opening new inbound market to the country, the struggle of international markets certainly will influence the future of Japan Integrated Resorts.

Thinking positively, as Japan Integrated Resort project has been in a policy making stage, Japan has a choice to restructure its regulatory requirements suitable to future market figures and a new style of inbound tourism, learning from the challenges the international market has been facing.

Japan has a long history of “learn from overseas and customise it our own way” as an attitude to create a new, original model that its mentality should be recalled and reflected in such difficult momentum.

The Association expects Japan Integrated Resorts to create and open state-of-the-art models of Integrated Resorts with inbound tourism opportunities and we will continuously support this goal.

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