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Gaming Report: Italy to Ban All Gambling Advertising, Success Dragon International Reshuffles Top Management & More

PokerGuru Gaming Report: Italy to Ban All Gambling Advertising
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  • PG News July 7, 2018
  • 8 mins Read

In this edition of our PokerGuru Gaming Report, we bring you several important developments from the gaming industry.

The first update comes right from Italy where the new coalition government has proposed a ‘Dignity Decree’ to place blanket ban on all advertising related to gambling. The move has drawn protest and flak from the gaming segment and sports leagues, even as the government stands by the decision.

We next focus on Hong-Kong based gaming firm, Success Dragon International that has, amid a slew of moves to check its financial losses effected a change in the top management, with chairman and CEO Tan Teng Hong stepping down and being replaced by Kwan Chun Wai.

We then highlight the recent efforts to rope in additional manpower by Imperial Pacific International (IPI) to complete its Saipan project – Imperial Pacific Resort (IPS) that was to be ready by August 2018 but will now be delayed at least till December 2018.

Rounding up our report is news from Paraguay where amid opposition from gaming operators, the country’s regulatory authorities have begun enforcing a new sports betting monopoly by awarding a firm, Daruma Sam S.A. with a five-year monopoly license to operate sports betting services and activities.

Italy Moves to Ban All Gambling Advertising Amid Protests From Sports Leagues & Gaming Industry

A recent announcement by the new coalition government of Italy to impose a blanket ban on all advertising related to gambling has sent the country’s gaming industry and sports leagues reeling in shock.

On Monday, Italy’s Council of Ministers approved the latest draft of the government’s ‘Dignity Decree’ that will be tabled before the full parliament for approval within 60 days and calls for total prohibition on all gambling advertising and sponsorships from January 1,2019 onwards. Italy’s Deputy Prime Minister Luigi Di Maio has claimed the move as a part of his coalition government’s effort to “set an example” for the rest of Europe in putting a cap on excessive gambling promotion.

Italy Moves to Ban All Gambling Advertising Amid Protests From Sports Leagues & Gaming Industry
Italy Moves to Ban All Gambling Advertising Amid Protests From Sports Leagues & Gaming Industry

If the draft proposal is approved, gambling companies in Italy will have only till June 30, 2019 to wrap up all existing deals. The ban will render all forms of gambling advertising, on radio, internet or any other means illegal and sponsorships for sporting clubs will also be prohibited.

This also means that top-flight soccer teams can no longer carry sponsorship logo on their jerseys and bring to halt free broadcasts of football matches. The only sector that will not be affected is any gambling run by the state, such as the Italian national lottery.

The prime sports leagues in Italy have publicly opposed the move and have mounted a united opposition to the prospect of a ban. Officials of Serie A league have expressed “extreme worry” over the move, claiming that the laws would put them at a competitive disadvantage to other European leagues and bring in huge losses for them. Last year, 12 Serie A top-tier football clubs had worked in a sort of partnership with a gambling company.

President of Genoa FC Enrico Preziosi has called the prohibition “madness”. The government didn’t understand the “devastating effects” the ban would have on local football, he said.

Sharp protests have come in from gaming industry advocates. LOGiCO, the trade body that works for online gaming operators said it is “perplexed” by the sweeping changes.

A statement issued by LOGiCO read, “LOGiCO does not believe that this ban can produce positive effects in terms of player protection or reduce – and certainly not eliminate – the risks derived from an uncontrolled practice of the games themselves.”

According to the European Gaming & Betting Association, the gambling industry contributed an annual €120m to Italian sports. Italian fans will still be exposed to international football teams’ gambling sponsorships due to “the cross-border nature of the internet and tele European Gaming & Betting Association, vision,” the Association in a statement said.

While the move may not immediately affect the future of online poker that is already in a stagnant phase in Italy despite it entering the shared poker player liquidity with Portugal, Spain and France, it looks unlikely that poker regulation in Italy will see much progress now that government is determined to turn the wheels into reverse gear for the Italian gaming industry.

CEO of Success Dragon International Holdings Tan Teng Hong Steps Down

As the Hong-Kong based gaming firm Success Dragon International Holdings struggles to cap its financial losses, the newly appointed Chairman and CEO of Success Dragon International Holdings, Tan Teng Hong has stepped down from his position.

Success Dragon
Success Dragon

The announcement was made by the company in a disclosure to the Hong Kong Stock Exchange, explaining that Hong will be leaving the company to focus on other business.

Effectively from July 3, 2018, Hong has been replaced by Kwan Chun Wai as the company’s chairman, executive director and CEO. Kwan, who has extensive background in banking, financial and technology sectors and is also a seasoned strategic consultant is believed to be a perfect fit for the role of CEO and chairman.

Just a few days back the firm announced that it would consider the use of blockchain in its gaming machines to recoup revenues. Success Dragon is seeking to diversify its business segments after its gaming revenues dipped by 25.7% in the fiscal year 2017-18, to HKD 112.4 Million. 95% of the group’s total revenues come from its gaming machine segment of Success Dragon and the segment saw a plunge of 18.2% in revenue, to HKD 107 Million while its profits dropped 18% year-on-year to HKD 27.1 Million.

To check losses, Success Dragon has initiated plans to invest in financial technology and develop non-cryptocurrency products using the blockchain.

IPI May Pool in Extra Manpower to Finish Imperial Pacific Resort on Time

Despite its earlier announcements that its Saipan project – Imperial Pacific Resort (IPS) will be ready by August 2018, Imperial Pacific International(IPI) is struggling to meet the deadline. Faced with a severe crunch in manpower, the company has now asked the Commonwealth Casino Commission (CCC) for an extension till December, while discussing the possibility of bringing in additional construction workers for completing the project during night.

When complete, the IPR will be a luxury integrated resort on the US Territory with more than 200 gaming tables, close to 350 slot machines and a 14-storyed hotel that will feature 374 hotel rooms. The IPI has recently moved casino operations from its Best Sunshine Live facility to IPR but is yet to be granted the full gaming license it will need to operate the new gaming facilities when the resort is fully operational.

Imperial Pacific Resort
Imperial Pacific Resort

VP of construction in IPI, Erik Poon, who is currently in discussions with the casino’s contractor Pacific Rim Contractors, confirmed this.

“Pacific Rim and IPI have been talking about second (work) shift which will start after 7pm until midnight. Right now, we already notified the people concerned about the possibility of night shift work. The exact date we still have to iron out with Pacific Rim because right now, we have to put the safety features needed especially at night before we put a date for the second (work) shift,”Poon said, adding that IPI has significantly increased manpower for the past few months, which has helped to put the schedule even further.

“Currently, we have 68 management staff and 1,402 workers in construction – 44 from Sinopan, 677 from Pacific Rim, and 700 IPI H2-B workers. We are still hiring, our requirement is 1,500 workers and right now we have 700 so we still have room to grow for sure.”

The project has been riddled with delays and allegations of financial improprieties, violations of employment agreements and adherence to contractual agreements. Last year, four Chinese companies involved with the resort’s constructions were ordered to pay compensation for unpaid wages and damages to the tune of $14 Million to more than 2,400 workers.

Paraguay Imposes Monopoly on Sports Betting

Amid stiff opposition from gaming operators, Paraguay has initiated enforcement of its new sports betting monopoly.

In March 2018, the National Commission of Games of Chance (Conajzar) of Paraguay had provided Daruma Sam S.A. with a five-year monopoly license, giving the firm legal rights to operate its sports betting services and activities under its Apostala (Aposta.la) brand. The license took effect from June, and the Paraguayan authorities have been cracking down on the nine organizations whose betting licenses have now become illegal.

Paraguay Imposes Monopoly on Sports Betting
Paraguay Imposes Monopoly on Sports Betting

Agents of the National Police and Public Prosecutor visited the premises of two betting firms Montego SA and Enfield on the request of the Conajzar. The legal representatives of both these organizations challenged the legality of the visits stating that, “both firms were operating under a judicial order while their legal challenge of the constitutionality of Conajzar’s decision is before the courts”.

Montego SA’s lawyer Paola Villalba alleged that the raids were made to hurt the credibility of Daruma Sam’s competitors by making it seem to the public that their services were illegal. Enfield attorney Agustín Saguier revealed that his client’s payment processing contract was abruptly ceased by its PagoPar provider, while betting gear from both locations were confiscated.

This decision to award Daruma Sam the sports betting monopoly has been froth with controversy.

Many have suspected political foul-play following the resignation of the former Conajzar chief Javier Balbuena. But with Paraguay moving towards a possible change in political leadership in August, the fate of the sports betting industry in the South American country seems uncertain.

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