Regulation Update: Vietnam Steps up in Southeast AsiaPublished January 27, 2017 by Lee R
Vietnam stands to gain more than most any other country, and emerges as an intriguing investment.
In regions of limited iGaming, small market developments can have significant implications.
Vietnam is an example of one such market. The tiny republic bordering China just recently lifted a long-standing ban on gambling on a three-year trial basis by allowing locals to enter selected casinos in the country.
As of March 15th, Vietnam locals over 21 years of age with a monthly income of at least VND 10 million (US$445) will be permitted to gamble at approved local casinos.
IR Involvement Required
Permitted casinos are required to not operate solely as gambling institutions, but must be part of greater entertainment and hotel complexes with investment capital of at least $2 billion.
First Two Casinos
Prime Minister Nguyen Xuan Phuc announced the first two approvals last December, in casinos at Phu Quoc Island and the Van Don Special Economic Zone near the Chinese border.
Despite relatively lax enforcement, the country is estimated be losing up to $800m a year in tax revenue from Vietnamese players who gamble in neighbouring countries such as Cambodia, keeping in mind that the Chinese mainland also does not allow gambling.
Enhancing the Situation
The new additions build on the existing market of seven licensed casinos, a state run national lottery and more than 60 provincial lotteries--prohibiting Vietnamese players unless they hold a foreign passport. General sports betting and online gambling remain illegal, with the exception of lottery tickets via state-sponsored providers.
As for figures for the legal Vietnamese gaming market, research places Vietnam’s legal casino and gambling industry gross gaming take at up to $400m for 2016.
With the government currently working on a regulation model of online betting, the black market revenues at this point are placed in the billions of dollars.
Current Vietnam Landscape
Five casinos are located near the Chinese border in the north and serve large percentages of Chinese nationals who come over the border to play. A regulation model is expected to be approved by the prime minister in the next few months.
Reforms on the horizon include limited forms of legalizing betting on football matches, horse and greyhound racing betting.
Potential Opportunity Lurking
Investment-wise, the reforms position Vietnam in a leadership role in regional iGaming regulation, with the size of the country providing a lot of attractive room for growth in a highly liquid region that has been slow to regulate until now.