Melco wins legal battle against ILGA

by Mia Chapman Last Updated
Melco wins legal battle against ILGA

Hong Kong casino giant Melco Resorts has won a battle to keep legally privileged documents secret from a public inquiry that is probing its purchase of a 20 per cent stake in Crown Resorts from James Packer.

Brisbane Times is reporting the New South Wales Independent Liquor and Gaming Authority’s unprecedented inquiry will in the coming months, dig through the inner-workings of Melco to decide whether it is a suitable company to be involved in Crown’s new casino, which is due to open at Sydney’s Barangaroo early next year.

The ILGA inquiry led by former New South Wales Supreme Court judge Patricia Bergin will also consider whether Mr Packer’s sale of a $1.76 billion stake in Crown to Melco in May 2019 breached Crown’s Sydney casino licence.

The licence bans involvement in Crown by Melco boss Lawrence Ho’s father, Stanley, and a number of associates because of alleged links to organised crime.

The inquiry was to have the same powers of a royal commission, including the ability to compel parties to give evidence and produce documents.

However, Melco took the regulator to the New South Wales Supreme Court last week to challenge its right to demand nine documents covered by legal privilege.

On Tuesday, Justice Christine Adamson ruled in Melco’s favour, meaning the ILGA will not be able to access the documents.

The case hinged on how a section of the Royal Commission Act, relating to witnesses not being able to use legal privilege to excuse themselves from giving evidence or producing documents, applied in the Casino Control Act.

Melco’s legal team, led by Steven Finch, SC, argued the casino legislation failed to clearly express that its intention was to abrogate what was a fundamental common law right.

Justice Adamson ruled that the court “ought not be left to guess” about what powers were intended to be given to a commissioner appointed to run an ILGA inquiry.

“If parliament intended that…it was obliged to make its intention clear,” she said.

But instead, the working of the casino legislation meant there was “substantial risk that the full implications” of the law would go unnoticed as it passed through Parliament.

Justice Adamson said it was not for the court to “enable Parliament to avoid confronting the inevitably controversial question whether, in inquiries held by ILGA, it is desirable to abrogate fundamental privileges and rights of witnesses and persons required to produce documents.”

An ILGA spokesman said the authority was “considering today’s court judgment and how it may impact the running of the inquiry.”

Melco offices raided in Tokyo

Crown Resorts’ controversial investor, Lawrence Ho’s Melco Resorts and Entertainment, is expected to respond to reports that its offices in Tokyo were raided as part of a political corruption probe to casino developments in the country.

The Brisbane Times reported last month that Melco’s offices in Tokyo were raided between January 17 and 20.

The raids came just days after Tokyo prosecutors arrested Liberal Democratic Party lawmaker Tsukasa Akimoto on suspicion of accepting bribes from Chinese gambling group, 500.com.

Mr Akimoto, who is in detention, has denied any wrongdoing.

Melco and 500.com are both among the gambling groups bidding for the rights to build three integrated casino resorts in Japan.

Melco established a Japanese local entity and offices in Tokyo, Osaka and Yokohama and submitted IR concepts to multiple local municipalities as part of its application process.

Mr Akimoto had played a central role in crafting government policy for the casino resorts.

Melco to respond after Chinese New Year holidays

A Melco spokesman said the company is expected to make a response to the reports once executives are back from Chinese New Year celebrations on Monday.

A Crown Resorts spokesperson said “this is a matter for Melco” and referred all further queries back to the Hong Kong-based company, which holds a 10 per cent stake in the casino operator.

The raiders are an unwelcome development for Melco, James Packer’s former Macau casino partner, which has come under scrutiny after announcing plans to acquire a 20 per cent stake in Crown from Mr Packer in May last year for $1.7 billion.

In August, the New South Wales Independent Liquor and Gaming Authority launched a public inquiry following revelations by The Age, Sydney Morning Herald and 60 Minutes that Crown worked with “junket” tour operators backed by powerful Asian crime gangs and Chinese foreign influence agents.

The inquiry is also considering whether the licence for Crown’s $2 billion Sydney casino was breached when Mr Packer agreed to sell the stake to Melco.

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