Macau Regulator DICJ Defends Strict Separation of Casinos and Junkets

In the special administrative region of Macau, the relationship between major casino concessionaires and junkets, the commercial gaming promoters, is causing political tension. The Gaming Inspection and Coordination Bureau (DICJ) has denied accusations that directly operated VIP businesses of casino companies are in competition with gambling promoters. In an official statement dated August 12, Acting DICJ Director Lio Chi Chong responded to parliamentary inquiries, clarifying that both entities have distinct duties and work within a cooperative framework. The law dictates that junkets only assist in recruiting players, while the actual gaming activities remain the exclusive domain of license holders.

The debate was fueled by lawmaker Chan Hao Weng, who called for a comprehensive review of junket regulations. He argues that the expansion of directly managed VIP services by casinos has severely narrowed the channels available for junkets to attract customers. This, he claims, creates an uneven competitive environment. According to DICJ data, there were 29 licensed junkets in Macau as of July. This represents only about 58 percent of the ceiling of 50 licenses set for 2027. Chan urged the government to relax the restriction limiting each junket to working with only one concessionaire and to reduce the 5 percent tax on commissions.

Numbers and facts

The economic framework for junkets has tightened drastically since January 2023. Commissions are legally capped at a maximum of 1.25 percent of the total net rolling-chip turnover. This ceiling includes all direct or indirect benefits provided to the promoter by the casino. Additionally, junkets must pay a 5 percent tax on their commission income with no exemptions. The DICJ emphasized that this structure serves to clearly separate the activities of promoters from casino operations and to prevent revenue-sharing models that were common in the past.

"The rules were intended to support the industry’s development in a sound and reasonable direction and help prevent another period of excessive and disorderly expansion." - Lio Chi Chong, Acting Director of the DICJ

Despite the strict requirements, there are signs of slight stabilization in the sector. For 2026, 29 junkets have been approved, an increase from the 24 operators at the start of 2025. Nevertheless, the industry is far from its heyday. In 2014, 235 junkets dominated the market, contributing up to 70 percent of Gross Gaming Revenue (GGR). The government expects to collect 150 million MOP (approx. 18.6 million USD) in taxes from commissions this year, a significant increase from the 100 million MOP expected for the 2025 fiscal year.

Background

The downfall of the old junket model is closely linked to the anti-corruption campaign led by Chinese President Xi Jinping. Spectacular criminal cases, such as the conviction of Alvin Chau, founder of Suncity, shook the industry. Chau was sentenced to 18 years in prison in 2023 for defrauding casinos of 823.7 billion HKD in undeclared bets and depriving the state of billions in tax revenue. Levo Chan, head of the Tak Chun junket, also received a 14-year sentence for organized crime and money laundering. These scandals lead to a lasting destruction of trust in the private VIP room system.

Today, junkets in Macau are prohibited from issuing their own credit lines to players or managing VIP rooms independently. These activities were previously the hub for illegal capital flight from mainland China. While the VIP share of total revenue was over 46 percent in 2019, it now accounts for only about 27.5 percent. Analysts at JP Morgan expect the mass market and slot machines to continue growing in 2026, while the VIP segment is projected to decline by about 5 percent.

Why it matters for German players

Developments in Macau do not have a direct impact on the daily lives of German players but highlight a global trend toward transparency and state control. In Germany, the State Treaty on Gambling 2021 (GlüStV 2021) is the decisive regulatory framework. In contrast to the previously opaque VIP structures in Asia, Germany relies on strict player protection measures such as the monthly deposit limit of 1,000 euros and the stake limit of 1 euro per spin on virtual slot machines. Monitoring is carried out centrally via systems like LUGAS, which is designed to prevent illegal agreements or money laundering, as seen in Macau.

Players in Germany should ensure they play only at providers listed on the official whitelist of the Gemeinsame Glücksspielbehörde der Länder (GGL). These casinos guarantee compliance with German safety standards. While junkets act as intermediaries in Macau, any form of commercial gaming brokerage for online casinos in Germany is strictly regulated and often prohibited to protect the channeling mandate. Those playing legally in Germany enjoy protection through the OASIS exclusion database, a significant advantage over less regulated markets like those in Asia or MGA-licensed providers.

What it means for GGL-licensed casinos

For operators with a GGL license, the news from Macau serves as a reminder of the importance of compliance rules. The strict separation of marketing partners (affiliates) and actual gaming operations is also a central issue in Germany. GGL-licensed casinos must ensure their partners do not receive revenue shares that could lead to overly aggressive advertising behavior. The Macau example shows that authorities worldwide crack down hard when the balance between market participants is disturbed or illegal financial flows are suspected. German regulation is already a step ahead, preventing the uncontrolled expansion of gray market structures through LUGAS and the whitelist requirement.