Jun 2 2017, 12:39 AM
Jun 01, 2017
Macau’s Legislative Assembly has approved in a final reading a government-proposed bill introducing a currency declaration requirement for all travellers to and from the jurisdiction. The new law will become effective on November 1, 2017.
The move, the government had said, would help fight the risk of money laundering in the city.
The bill approved on Wednesday proposes that people entering or leaving Macau who have cash or other “negotiable monetary instruments” – for instance, cheques payable to the holder, travellers’ cheques or gold coins – valued at MOP120,000 (US$15,000) or more in their possession, must submit to the Macau Customs Service a declaration form to that effect. The trigger amount for declarations will be set out in subsidiary regulations.
Submitted declaration forms will be kept by customs for a total of five years. After that time, the declarations will be destroyed if no suspicion of wrongdoing has come to the attention of the authorities.
Those who fail to comply with the proposed reporting rules can incur fines ranging from MOP1,000 up to MOP500,000.
The government had said that the bill followed recommendations to Macau by the Paris-based Financial Action Task Force (FATF) aiming to improve the city’s anti-money laundering measures.
Alex Vong Iao Lek, Director-General of the Macau Customs Service, on Wednesday said the government would be publicising the new rules prior to the law becoming effective. “This will allow the government to have enough time to promote the law in all checkpoints across Macau and through various media platforms,” Mr Vong said as quoted by local public broadcaster TDM.
A recent focus for the Macau government has been tighter controls on the large volumes of money flowing through the city’s casinos via VIP gambling. Such play is typically funded by credit issued by government-licensed gaming promoters – commonly referred to as junkets. They also arrange – via agents and sub-agents – collections on player gambling losses.
The Monetary Authority of Macao last week announced the establishment of a “Financial Security Expert Alliance”, in collaboration with the People’s Bank of China and the Hong Kong Monetary Authority. The announcement followed a meeting in Macau between senior officials of the three institutions.
No impact on gaming: JP Morgan
Commenting on the proposed new border currency declaration system in Macau, the JP Morgan analysts said the measure was “really to adopt the international standard of anti-money laundering, [and] does not have anything to do with China’s capital control, nor does it target the gaming industry.”
Analysts DS Kim and Sean Zhuang added: “We believe this is not a regulatory tightening for the gaming industry or Chinese capital outflow into Macau, unlike some investors may fear, given its seemingly scary headline.”
They noted that “mainland Chinese can legally bring only RMB 20,000 (US$2,900) per overseas trip in any case; hence, this US$15,000 limit is already five times higher than the legal limit for Chinese travellers.” In addition, VIP gamblers, “usually do not carry cash across the border” as they usually gamble on credit and other financing forms provided by junket operators.
“High-end premium mass players are mainly using UnionPay [cards] cash-back transaction at pawnshops to get gambling money (which is still legal, by the way); [and] most mid/low-end premium mass and grind-mass players, by definition, would not spend US$15,000 per trip anyways,” the two JP Morgan analysts stated.
The FATF is an intergovernmental body originally set up in 1989 by the Group of 7 countries – also known as the G7 – to combat a perceived growing global risk posed by money laundering.
A recent focus for the Macau government has been tighter controls on the large volumes of money flowing through the city’s casinos via VIP gambling. Such play is typically funded by credit issued by government-licensed gaming promoters – commonly referred to as junkets. They also arrange – via agents and sub-agents – collections on player gambling losses.
This post has been edited by PLOUFFLE: Jun 2 2017, 12:40 AM
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