Under the current contract, if the casino licence is cancelled by ILGA, the operator could request payment of US$145m in damages.
Australia.- A new bill has been introduced in the New South Wells (NSW) Parliament to limit Crown Resorts’ potential legal claim in the event restrictions or punishments are imposed on the company after the hearings conducted by the NSW Independent Liquor & Gaming Authority (ILGA).
In 2014 Crown entered a contract with the NSW government under which the state would have to compensate the firm for any negative impact caused by regulatory action.
Concerns were raised that the casino operator could claim in the event that business is affected by the decision of the hearing, which is due in February.
State MP Justin Field has entered a bill in the Parliament for the nullification of the 2014 agreement.
Field said when presenting the bill: “Because of a deal done between Crown, the New South Wales Government and the Independent Liquor & Gaming Authority back in 2014 both the authority and the Government may be constrained in the regulatory response to the inquiry by a compensation agreement.
“It could result in hundreds of millions of dollars of compensation being payable to Crown and Crown associated companies, should the regulator or this Parliament seek to act in the public interest and change casino laws and regulations in this State.”
Field insisted that amending the current agreement is necessary because if the Government or ILGA take steps to change Crown’s casino licence for its new Barangaroo casino, Crown could pursue compensation, which would be a minimum of AU$200m (US$145m) for cancellation of the licence before the first two years of the operation.
The MP said: “The ILGA and the Minister were right to establish the inquiry. Its findings should inform considerations of the future of the Barangaroo licence and the regulatory environment for all casinos.
The Parliament should ensure that ILGA and the Minister have the freedom to act as is necessary in the public interest without the threat of massive financial penalties to the state.”