What Is the Future of Gambling in Japan?

08:01
11 Jun

The gambling industry in Japan is almost non-existent. Strict laws dictate that almost all forms of gambling are banned with very few exceptions. A cursory search for Japan casino reveals exactly that. Bar a restrictive list of sports that can be wagered on, Japanese residents have little more than Pachinko and foreign online casinos if they want to partake in a game of chance.

---

Pachinko?

The game known as pachinko is best described as a vertical pinball game. Ball bearings are paid for and then fired into the machine, and if the player hits the correct part of the game then extra balls are paid out. These balls are then returned to the reception and exchanged for a voucher that can be further exchanged for either money or various prize items elsewhere. This idea of functioning over two properties allows pachinko parlors to circumvent gambling laws.

Modern day pachinko is an electronic arcade type set up where players activate different games depending on where their ball bearings land. It might sound a bit quirky to westerners but this is massively popular in Japan and was described as a national obsession by Reuters. We could consider it a Japanese version of slot machines.

As far as thinking about the future of gambling in Japan goes, consider that the pachinko industry collects more than $200 billion in tax revenue every year. With numbers like that, why would they want to start changing anything?

---

Online Gambling and Poker

Although there are no dedicated Japanese online casino sites, there are a number of off-shore businesses catering to that market. It is completely legal for Japanese citizens to gamble on foreign-owned websites that offer games such as roulette and blackjack.

Live dealer games in particular are popular among Japanese gamblers. Understandable given that there is no land casino culture in the country as of yet, even though laws have been passed allowing movement in that space.

Poker hasn’t taken off in Japan either, but it’s not a totally dead scene. On occasion Japan-based players are seen on some of the mainstream sites, but, even though this is legal, the population doesn’t seem to have taken to the game yet.

---

Land Casinos

In 2018 the Japanese government passed laws to allow casinos to be operated in what they called “integrated resorts.” There was widespread enthusiasm for what would be a new, exciting market in the country with the potential to bring in plenty of tax revenue from tourists. Sadly, there hasn’t been much in the way of movement at all.

Las Vegas Sands Corp. bowed out of a bidding process a couple of years ago citing the delays in creating a regulatory framework as just unworkable. Before his death in January 2021, former CEO Sheldon Adelson said that unless the framework was modified the company would never be able to meet its goals in the country.

In the last couple of months Galaxy Entertainment Group and Suncity Group have also pulled out of the process. The Chinese gaming giants were not happy with the process for the same reasons as Adelson.

Suncity Chairman Alvin Chau said:

"We have decided to make a strict decision after careful consideration, considering the enormous impact of the COVID-19 pandemic on the industry. The fact that many matters are still unclear in Japan's IR (integrated resort) zone certification process, which is expected to take much longer than originally planned, has also added extra risk."

This doesn’t bode well for the future with the COVID-19 pandemic muddying the waters for an industry that promised so much. There has been talk for decades about pushing these laws through in Japan but still it’s all come to nought.

For now, the future of gambling in Japan looks to be exactly what it is today. Pachinko will remain a national obsession with a healthy number choosing to gamble in online casinos that are based abroad.