Tuesday, March 24, 2009

In-flight Gambling Special

Podcast Text:
Hello, and welcome to the GamblingCompliance weekly podcast. This week we’ll be taking to the skies and exploring the possibility of in-flight casino gambling at 30,000 feet. Leading European aircraft-maker Airbus said this week that it has been approached by a group of potential Asian buyers who are looking to convert Airbus’s A380 jet into the world’s first flying casino. An Airbus executive said the company had already begun discussions with casino operators and that a fully fitted flying casino could be ready sometime between 2012 and 2017. The casino jet would cater to mile-high rollers mainly from Asian countries, Airbus maintains. But with gambling restricted or prohibited outright in much of the region, including mainland China, it remains to be seen how the plans will be viewed by authorities down below on terra firma. It is not the first time that the idea of in-flight gambling services on commercial aeroplanes has been suggested. Singapore Airlines, Virgin Atlantic, Swissair and casino operators Harrah’s and MGM have all previously shown an interest. But plans have remained grounded due partly to the tragic crash of a Swissair jet in 1998 - which was widely attributed to a technical problem with video gambling machines – and partly to US aviation legislation that clearly reduces the economic viability of in-flight gambling to aviation manufactures and carriers. Gambling activity on aircraft is viewed as similar to gambling on a cruise ship. The casino can only be open while the craft is over international waters. But the so-called Gorton Amendment – passed by the US Congress in 1994 – prohibits any gambling machine even to be installed or transported on planes flying across US airspace. The prohibition on even installing or transporting a gambling device made in-flight gambling a commercial impossibility for any airline as it would effectively preclude that jet from ever entering US airspace. However, the Gorton Amendment applies only to commercial jets – and Las Vegas-based casino operators are now exploring the possibility of offering gambling on private jets used to fly high-rollers between resorts in Vegas and Asia. Las Vegas Sands announced last week that it has purchased and plans to refit two aeroplanes to serve as private jets to chauffeur big-spending gamblers from Asia to the company's two Strip resorts. In addition to the typical luxury items found on a casino company's private aircraft, customers will also have high-limit baccarat tables at their disposal to pass the time during the 14-hour direct flight between Vegas and Hong Kong. GamblingCompliance has learned that Las Vegas Sands has been training dealers for in-flight dealing duties for several months. The dealers are coming from the company’s two Macau casinos, the Sands Macau and Venetian Macau – but plans have already been squared with gaming regulators in Nevada. Las Vegas Sands officials told Nevada gaming regulators of their plans in a letter in mid-January. The Nevada Gaming Control Board conceded that there was nothing in state law that would halt the activity, adding that there are no requirements for Las Vegas Sands to report revenues earned from a foreign gaming operation and that revenue from gambling on Sands’ planes would not be subject to the 6.75 percent gaming tax in the state. Gaming Control Board chief Dennis Neilander said that the only restriction under Nevada law was that Sands had to conduct foreign gaming within the same standards the company would conduct its business in Nevada, and report that the in-flight gambling activity took place. Sands has also been given the thumbs up by the US Federal Aviation Administration. Representatives from the aviation regulator confirmed that the agency does not regulate activity aboard private jets and said that it would only be concerned with any safety issues that may arise from gambling equipment. It remains to be seen how Las Vegas Sands’ plans with be met by regulators in Asia. But in-flight gambling on private jets certainly seems to be more viable than on commercial flights. Offering gambling may be a long-standing dream of commercial airlines and manufacturers such as Airbus, but US legislation and problematic jurisdictional questions make predicting the future of in-flight gambling difficult. Will it ever truly take-off? Or do those gambling on midair gambling already have their heads in the clouds?

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