Nov. 29 (Bloomberg) -- A bill legalizing casinos will probably be submitted to the current session of parliament, an official at Japan’s ruling Liberal Democratic Party said today, fueling gains in gaming company shares.
“I think we will submit it,” Seiko Noda, the chairman of the LDP’s General Council, said in Tokyo, referring to the session ending on Dec. 6. “This is a first for Japan. It will be a step toward building up Japan’s status as a tourist destination,” she told reporters after the council approved the bill.
Pachinko company Dynam Japan Holdings Co., which is interested in operating a casino in Japan, gained as much as 9.9 percent as of 1:03 p.m. in Hong Kong today as it headed for a record close. Gaming machine companies Konami Corp. and Sega Sammy Holdings Inc. rose as much as 6 percent and 2.9 percent respectively in Tokyo. Gaming equipment maker Japan Cash Machine Co. added as much as 4.6 percent. The gains compared with a 0.6 percent decline in the benchmark Topix stock index.
“The LDP’s decision is definitely a plus for casino-related stocks like Konami,” said Tomoaki Kawasaki, an analyst at IwaiCosmo Holdings Inc. “The casino legalization has already started to be reflected in their stock prices, but it’s not clear if it was fully reflected yet. So every time there is a step forward, the stock price will be impacted positively going forward.”
A cross-party group of lawmakers headed by LDP deputy Secretary General Hiroyuki Hosoda has said it’s preparing to submit the casino legalization bill to the Diet by the end of next week. It is unclear whether junior coalition partner New Komeito will back the bill. Generally, legislation submitted under Abe’s administration has been backed by both parties and the LDP relies on support from Komeito in elections.
New Komeito leader Natsuo Yamaguchi told Bloomberg in an interview this month that his party was divided on the bill and he was doubtful whether it would reach consensus before the end of the session.
The LDP has a single-party majority in the lower house and would probably gain enough opposition support to pass the bill in the upper house and enact the law even without New Komeito’s backing.
While betting on horse, boat and bicycle racing is allowed, casinos are currently illegal in Japan. International gaming companies have been considering billions of dollars in investment in “integrated resorts” offering accommodation and other forms of entertainment alongside casinos if the bill is passed.
To contact the editor responsible for this story: Rosalind Mathieson at firstname.lastname@example.org