Gambling in Japan

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In Japan, most forms of gambling are generally banned by the Criminal Code chapter 23. However, there are several exceptions, including betting on horse racing and certain motor sports. Public sports, lotteries, and toto (football pools) are held under special laws to increase the income of national and local governments as well as to offer a form of entertainment.

Since 2018, casino operators have been bidding for three legal licenses to operate an integrated casino resort in Japan, including in Osaka, Tokyo, and Yokohama. The Japanese government established the Casino Administration Committee in 2020 to supervise and manage Japan’s resort operators.

Kōei kyōgi

Kōei kyōgi (Japanese: 公営競技, public sports) are public races that can be gambled on legally. There are four types: horse racing, bicycle racing, powerboat racing, and asphalt speedway motorcycle racing. They are allowed by special laws and are regulated by local governments or governmental corporations. All four types employ parimutuel betting. The prize pool for gamblers on these races is 70–80% of total sales. Betting tickets are available at numerous circuits and ticket booths (off-track betting) within many cities.

Takarakuji

Takarakuji (Japanese: 宝くじ), or lotteries, are held by prefectures or large cities throughout the year. There are three main types of lotteries: unique number lotteries, selected number lotteries, and scratch cards. Each lottery ticket is sold for 100 to 500 yen, and the top cash prizes are usually 100 million yen or more. The takarakuji law stipulates that the entire prize pool for any lottery must be less than 50% of total sales, with the remainder going to local government organizations and charities. Takarakuji tickets are available at takarakuji booths and stores, with some outlets becoming particularly popular. Tickets for selected number lotteries can also be bought at some ATMs.

Pachinko

Pachinko is a pinball-like slot machine game that is officially not considered gambling because Japanese laws regard pachinko as an exception to the criminal code on gambling for historical, monetary, and cultural reasons. Pachinko parlors can be found all over Japan and are operated by private companies. As of 2011, there are about 12,480 pachinko parlors in Japan. In 2018, Japan spent $200 billion on pachinko each year, with “nearly half of all leisure time in Japan” spent in these parlors.

In pachinko, when a player’s ball enters a special hole to activate the slot machine and a jackpot is made, they are rewarded with more balls. Players can then exchange these balls for prizes of varying value at a booth in the parlor. Money cannot be awarded directly at pachinko parlors, as this would violate the criminal code; however, players often exchange pachinko balls for special tokens and then “sell” them at a neighboring shop for cash.

On April 4, 2011, Shintaro Ishihara, the Governor of Tokyo at the time, criticized pachinko parlors for wasting electricity, claiming they consumed “nearly 10 million kilowatts of energy.” Following the earthquake on March 11, 2011, he argued for reduced energy consumption, but stated that asking was insufficient without government enforcement. In 2016, the Parliament voted to approve a law that could “alter the gambling industry in Japan.”

Illegal Gambling

The Yakuza are known to operate illegal casinos in Japan. Besides traditional casino games, mahjong can be played for money, with many mahjong parlors connected to the Yakuza to assist in collecting debts from players. Another illegal gambling opportunity comes from mobile gambling sites, where Japanese gamblers can play rock-paper-scissors for cash prizes. In 2010, the owner of one site was arrested after confessing to earning over $1 million through this method.

Efforts to Legalize Gambling

There have been movements within the Liberal Democratic Party (LDP) government to open casinos to boost tourism in Japan. Despite public interest, operating casinos remains illegal, and recent scandals involving sumo wrestlers betting on baseball have hindered progress. In 2000, former mayor Ishihara proposed building casinos in Odaiba, but the plan was not fully approved due to concerns regarding potential gambling addiction among the Japanese populace.

Casino legislation gained momentum with lawmakers submitting the Integrated Resort (IR) Enabling Act to the Diet in 2015.

Legalization and Bidding

In July 2018, Japanese lawmakers approved a bill that officially allows casinos in the country. Three casinos in the form of integrated resorts (IRs) will be established in different locations, with restrictions: Japanese locals can only visit the casinos three times a week or ten times a month, and they will be charged a 6,000 yen entrance fee to help mitigate addiction.

Osaka was the first to launch the “Request For Proposal” (RFP) process in 2019. The five companies that applied for an Osaka integrated casino resort license are Las Vegas Sands, Wynn Resorts, MGM Resorts, Melco Resorts, and Genting Singapore. In February 2020, only MGM Resorts submitted a bid in Osaka. Las Vegas Sands, Melco Resorts, and Wynn Resorts redirected their focus to bidding processes in Yokohama and Tokyo for the remaining two licenses.

On May 13, 2020, Las Vegas Sands retracted its bid to open an IR in Japan due to the postponement of the Tokyo 2020 Olympics and the global coronavirus pandemic.

Casino Administration Committee

The Japanese government established the Casino Administration Committee on January 7, 2020, to supervise and manage Japan’s IR operators. This committee functions as an external department to the cabinet, with the chairman being Michio Katamura. It will grant casino licenses, revoke them, and investigate operators and related officers.