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Logo of Phnom Penh Post newspaper Phnom Penh Post - Monopoly a winner for CamboSix

Monopoly a winner for CamboSix

Monopoly a winner for CamboSix

The Ministry of Finance announcement last month that football betting juggernaut

CamboSix had won another four-year monopoly for sports gambling in Cambodia,

seems to indicate a sure bet the gaming giant will be extending its gambling

empire.

For one thing, the company retained its legal authority to

conduct Internet football wagering - an industry reportedly worth $12 billion

worldwide last year.

Asian gambling expert Ted Loh has told the Post

that the revenue generated by CamboSix's online gambling will far exceed the

profits from the 21 betting parlors stationed across Phnom Penh. Loh believes

the biggest profits may be coming from outside the country. And a source close

to football in Cambodia says CamboSix could already be making as much as $20

million each month.

"It's entirely possible [$20 million per month].

Football betting, online or off, is a massive industry. Some Asian countries

alone bet more on one match than all of Europe combined - really the rest of the

world combined," said Loh, gambling analyst and owner of consulting group Orient

Gaming. "CamboSix is just one of hundreds of bookmaking operations throughout

Asia, although obviously licensed by the Cambodian government. If anything,

CamboSix probably gets more action from Vietnam, and possibly Thailand, than it

does from within Cambodia."

Loh said operators of gambling websites view

Southeast Asia as the "promised land." Widespread gambling prohibitions in the

region have created a vast pool of pent-up demand, he said, and countries with

lax legal systems and underdeveloped telecommunications monitors are the perfect

place to provide what has become a borderless, around-the-clock pursuit.

"Internet gambling is quickly ... spreading across the Far East,

bringing with it games that never end, rules that are very much in flux and, for

those who would provide it to the masses, stakes best-suited to players with

near-bottomless pockets," wrote gambling expert Mark Bruner in Internet gaming

in Asia.

So Khun, Minister of Post and Telecommunications, told the Post

on March 6 that there are no laws on the Internet because the draft law on

telecommunications has yet to be passed.

"We don't know about football

betting through websites, maybe some companies have received licenses from other

authorities," he said. "The government's policy so far has been to give licenses

for the Internet industry based on the requests of

businessmen."

CamboSix, which opened as Royal Cambodia Goals Co Ltd by

the CamboSix Investment Group in 2002, now has 21 betting shops in Phnom Penh

and one in Sihanoukville. Football gamblers can place bets over the phone or

Internet within the country, but outside Cambodia, especially in Vietnam and

Thailand where gambling is illegal, the system is murky and, as yet,

unmonitored. According to Loh, there are no fixed regulations on online gaming

in Asia.

"It is a good question about who is regulating the process of

betting through the Internet. But I don't know about this issue," said Chea Peng

Chheang, secretary of state at the Ministry of Economy and Finance on March 6.

"But the ministry will take it into account and consider the issue. Right now we

are not clear."

CamboSix general manager Nancy Chau and administrative

manager Heng Say did not return phone calls or messages on the subject of

cross-border online gambling. But visits to several CamboSix outlets in Phnom

Penh revealed that employees are already addressing the issue in different ways.

At one shop, betting through CamboSix while outside Cambodia required

the purchase for $50 of a user name and password, necessary to access the

wagering site - then a minimum deposit of another $50. But a CamboSix staff

member said deposits are usually more than $1,000. Winnings are paid through

bank accounts; losses are deducted from the deposit. No credit card is

necessary. The employee specifically said the system could be used anywhere,

including the United States, where online gaming is illegal.

At the

CamboSix headquarters on Sihanouk Boulevard, an employee reiterated the process,

but added a caveat.

"You can bet from Vietnam, but you can't sell your

account to anyone . If you sell your password it's illegal," said the staff

member. "Just bet on your own so nobody knows."

Loh explained that

CamboSix is more attractive than foreign betting operations because it provides

the best odds and betting opportunities. He detailed a system of payment based

on a time-honored Chinese tradition in which a third party accepts cash for the

intermediary.

"What you're talking about is essentially a system of

agents traditionally used throughout Asia. A bookmaker usually has a network of

agents, subagents, etc," he said.

"Think of a pyramid structure: where he

will lend credit to his top tier of agents, who then extend part of that credit

to their subagents and funds must be settled on a regular basis - usually once

or twice a week. Cambodia is no different from any other gambling operation in

Asia, even including casino gambling in Macau."

The boom in Internet

football betting has civil society leaders and the opposition repeating

longstanding concerns about CamboSix's relationship with the ruling party, its

perceived lack of adequate taxation, and gambling's negative impact on society.

"This was not a transparent process; CamboSix was relicensed and was the

only company truly considered. This is about corrupt officials. The one who gets

bribed the most gets the monopoly," said Sam Rainsy Party parliamentarian Son

Chhay, who estimates that CamboSix makes at least $30 million per year, and pays

only 2 to 3 percent of its earnings in taxes. "Think about it: this is a

supposedly free market economy where the government can award a monopoly? There

is no government system in place to control the cash flow. To operate a business

of this size you must be close to the ruling CPP."

Peng Chheang told

local media on February 27 that Prime Minister Hun Sen awarded the exclusive

contract to CamboSix after the company paid $1 million to the government. Peng

Chheang said the company agreed to an increase in its taxation, but he could not

remember how much. This came just weeks after the government opened the bidding

process with an asking price of $2 million annually for the concession. Peng

Chheang said there was only one other player in the concession bidding, and on

March 7 he could not recall the name or nationality.

In the past, Peng

Chheang has said that CamboSix contributes $300,000 to the national budget each

year, but again could not recall the exact figure.

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