Casinos & Online Casinos: Which Will Penetrate Japan First?

At the time of writing ("Lockdown 2020") Japan has no casinos. But that situation is in the process of being changed. Although the hurdle of public perception has yet to be fully overcome, the government is fully behind introducing the legislation and infrastructure to have casinos up and running in the near future.

The Regulatory Environment

The Penal Code of Japan states that anyone who runs a for-profit gambling establishment is punishable by three months to five years in prison. However, gaming and gambling establishments would be legal if specific legislation to allow them were enacted. The Integrated Resort Promotion Act and Integrated Resort Development Act allow for casinos and gambling to be established at integrated resorts.

The typically long-winded "Act on Development of Specified Complex Tourist Facilities Areas" was enacted in July 2017. This Act corresponds to the equally long-winded "Act on Promotion of Development of Specified Complex Tourist Facilities Areas that was enacted in December 2016. These Acts concerning so-called "integrated resorts" define "specified complex tourist facilities" as places that integrate casino, convention and conference, recreation, exhibition, accommodation, and other facilities. The government intends to promote tourism and regional economies while adding to public finances through the development of these resorts.

The rather serious members of the Casino Regulatory Committee.

The rather serious members of the Casino Regulatory Committee. (photo courtesy of Kyodo News)

Winds of Change

The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) was tasked with establishing a basic policy on developing integrated resorts by July 2020. The government set up the Casino Regulatory Committee in 2019 to manage the establishment of casinos and provide oversight of their management. With a committee of five members and a working secretariat of almost 100, the aim was to draw up casino regulations by the spring of 2021, with a view to opening three casino resorts in Japan.

Prefectures or designated large cities that plan to establish an integrated resort are expected to set the implementation policy for the resort's development in line with the basic policy of the MLIT. A prefecture or designated large city have to choose a company to submit the application to the MLIT for approval to develop the integrated resort.

Once a casino has been established and in operation, the national government and the prefectural or city government must jointly impose a casino-entrance fee of 3,000 yen (about US$27) for residents of Japan, as well as a tax of 15% on the casino's profits.

A Bad Start

The Regulatory Committee held its first meeting in January 2020 and already faced casino-related concerns among the public, such as gambling addiction and the potential for criminal involvement. But to make matters worse, the first meeting was held against the backdrop of a high-profile bribery scandal related to integrated resorts. Akimoto Tsukasa, a lawmaker and former state minister for the government's project to launch integrated resorts, had been arrested for allegedly accepting bribes from a Chinese company that planned to open a resort in Japan.

The government announced that it would delay part of the process for selecting casino host cities amid the bribery candal. And of course, any progress with these plans was soon to become secondary to nationwide, and indeed global concerns about the ongoing pandemic.

The Online Casino Situation

Meanwhile, for the latest news on what's happening with online casinos from the Japanese perspective, you should check out Japanese Online Casino News. While sports betting online is available, online poker or other casino games have yet to be legalized. Not that this stops Japanese gambling fans from playing on sites based overseas.

Many online casinos offer a bonus for newly registered customers, so you don't even have to pay money up front. However, betting conditions and how soon you can cash out your winnings may differ depending on the casino. Another factor to consider is the payout rate. Compared to the approximately 46% payout rate for the lottery, 70-80% rate for horse or boat racing, or 80-85% rate for pachinko, the rate for online casinos is 93-98%. There is also often a time limit by which you need to withdraw any bonus.

And if you're new to the whole world of gambling online, it would probably be a good idea to visit the above site and check out rules of online casinos or on-kaji as they are known in Japanese.

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