China’s new restrictions on package tours to gambling hubs

Casino markets around the world could face declines in the number of Chinese mass market gamblers entering their casino venues due to Beijing’s new rules on package tour operations.

On Friday, Chinese media outlet Caixin reported that the China National Tourism Administration had announced new rules for domestic organizers of international holiday package tours. The new restrictions are aimed at reducing Chinese tourists’ ability to access gambling, drugs, sex and fun, apparently, while traveling abroad.

Specifically, the tourism watchdog’s new Rules on the Oversight of Tour Guides threaten to revoke the licenses and impose fines of up to RMB 20k (US $3k) on tour organizers who ferry customers to international ports of call for the purposes of debauchery. The changes will take effect on January 1, 2018.

Tour operators will face the same sanctions if they make unscheduled alterations to their travelers’ itineraries or force them to make pitstops at pricey ripoff souvenir stores. Chinese media is replete with tales of tour guides berating tourists who decline to make sufficient purchases at these partner stores.

Left unsaid is how the tourism watchdog plans to monitor compliance with the new rules, given that gambling, sex and drugs aren’t necessarily listed on the tour brochures, and the fact that the illicit activity takes place outside China’s territorial authority. But the government has launched an electronic system linked to a national database to keep tabs on its tour guides, and its ability to eavesdrop on its citizens is notoriously vast.

Casinos in jurisdictions such as Macau, Manila and South Korea’s Jeju Island have grown accustomed, even reliant, on a steady stream of Chinese mass market gamblers coming through their doors via these package tours.

Even Las Vegas’ newest casino, the China-themed Lucky Dragon, has said it relies on international tourists for at least 10% of its clientele. Caesars Entertainment recently began accepting Vegas room bookings via China’s popular WeChat social media platform.

The effects on casinos of China’s willingness to staunch the flow of its citizens traveling abroad to gamble is well-documented, with South Korean venues reporting Chinese visitation falling 89% after the two countries got involved in a diplomatic spat over US missiles on Korean territory. By contrast, casinos in the Philippines are enjoying a lucrative surge in Chinese visitation thanks to President Rodrigo Duterte decision to establish closer ties to Beijing.